Question

In: Accounting

SoakNSun Swim Park sells individual and family tickets. With a​ ticket, each person receives a​ meal,...

SoakNSun Swim Park sells individual and family tickets. With a​ ticket, each person receives a​ meal, three​ beverages, and unlimited use of the swimming pools. SoakNSun has the following ticket prices and variable costs for 2018​:

Individual

Family

Sale price per ticket

$25

$75

Variable cost per ticket

15

60

SoakNSun expects to sell one individual ticket for every three family tickets. SoakNSun​'s total fixed costs are $61,875.

Requirement 1. Compute the​ weighted-average contribution margin per ticket.

Complete the table below to calculate the​ weighted-average contribution margin. ​(Round the​ weighted-average contribution margin per unit to the nearest​ cent.)

Individual

Family

Total

-

x

  

Contribution margin

Weighted-average contribution margin per unit

Requirement 2. Calculate the total number of tickets SoakNSun must sell to break even.Start by selecting the formula and entering the amounts to calculate the total number of tickets SoakNSun must sell to break even. ​(Abbreviations used: Weighted avg. CM​ = weighted-average contribution margin. Complete all answer boxes. For items with a zero​ value, enter​ "0".)

(

+

  

) /

  

=

Required sales in units

(

+

  

) /

=

  

Requirement 3. Calculate the number of individual tickets and the number of family tickets the company must sell to break even.

  

x

=

Breakeven sales of tickets

Individual

x

=

Family

x

=

  

Solutions

Expert Solution

Requirement 1. Compute the​ weighted-average contribution margin per ticket.

Complete the table below to calculate the​ weighted-average contribution margin. ​(Round the​ weighted-average contribution margin per unit to the nearest​ cent.)

Individual

Family

Total
Sale price 25 75

-

 Variable cost 15 60
Contribution margin 10 15

x

 Sales mix 1 3

  

Contribution margin

 10 45

Weighted-average contribution margin per unit

 55

Requirement 2. Calculate the total number of tickets SoakNSun must sell to break even.Start by selecting the formula and entering the amounts to calculate the total number of tickets SoakNSun must sell to break even. ​(Abbreviations used: Weighted avg. CM​ = weighted-average contribution margin. Complete all answer boxes. For items with a zero​ value, enter​ "0".)

(

 Fixed cost

+

Desired profit  

) /

Weighted average contribution margin per unit  

=

Required sales in units

(

 61875

+

0

) /

 55

=

1125  

Requirement 3. Calculate the number of individual tickets and the number of family tickets the company must sell to break even.

  

x

=

Breakeven sales of tickets

Individual

 1125

x

 1/4

=

 281

Family

 1125

x

 3/4

=

844

ekkarill92 answered 1 year ago
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