A small local cinema that plays a new movie every two months has secured the rights to play a new independent movie for the next two months at a cost of $330.000. The cinema also has monthly fixed costs of $38,000. Approximately how many tickets must the cinema sell over the next two months in order to break even? Assume that it costs $9 to print a hundred tickets and that each ticket is priced at $18. (Round up your answer to the next whole number) Number of tickets: Numeric Response

A small local cinema that plays a new movie every two months has secured the rights to play a new independent movie for the next two months at a cost of $330.000. The cinema also has monthly fixed costs of $38,000. Approximately how many tickets must the cinema sell over the next two months in order to break even? Assume that it costs $9 to print a hundred tickets and that each ticket is priced at $18. (Round up your answer to the next whole number) Number of tickets: Numeric Response

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

You are thinking of opening a small copy shop. It costs $3500 to rent a copier for a year, and it costs $0.03 per copy to operate the copier. Other fixed costs of running the store will amount to $350 per month. You plan to charge an average of $0.10 per copy, and the store will be open 365 days per year. Each copier can make up to 100,000* copies per year. a) For a charge per copy between $0.07 to $0.11 and daily demands of 500, 1000, 1500, and 2000 copies per day, find annual profit. That is, find annual profit for each of these combinations of charge per copy and daily demand. use a two way table
Golden Gate Novelties (GGN) sells souvenir key chains at the local airport. GGN charges $12.00 per chain. The variable cost for a chain, including the wholesale cost of the chain, packaging, the commission paid to the airport operator, and so on, is $10.40. The annual fixed cost for GGN is $15,000. Required: a. How many cases must Golden Gate Novelties sell every year to break even? Note: Do not round intermediate calculations. b. The owner of GGN believes that the company can sell 12,500 chains a year. What is the margin of safety in terms of the number of chains? a. Break-even point b. Margin of safety chains chains
RJR Logistics needs a new color printer. The cost of the printer is $2,025, plus $380 per year in maintenance costs (the first maintence cost would occur in 1 year). The color printer will last for five years. Alternatively, a local company offers to lease the printer to RJR and do the maintenance as well. If the discount rate is 5.7%, what is the most RJR would be willing to pay per year to lease the color printer (the first lease payment would be due in one year)? The most RJR would be willing to pay per year to lease the color printer is closest to: O A. $897 B. $857 C. $884 D. $777
Crane, Inc., sells two types of water pitchers, plastic and glass. Plastic pitchers cost the company $30 and are sold for $40. Glass pitchers cost $26 and are sold for $47. All other costs are fixed at $280,800 per year. Current sales plans call for 14,000 plastic pitchers and 28,000 glass pitchers to be sold in the coming year. How many pitchers of each type must be sold to break even in the coming year? (Use contribution margin per unit to calculate breakeven units.)
Golden Gate Novelties (GGN) sells souvenir key chains at the local airport. GGN charges $13.00 per chain. The variable cost for a chain, including the wholesale cost of the chain, packaging, the commission paid to the airport operator, and so on, is $11.40. The annual fixed cost for GGN is $15,120. Required: How many cases must Golden Gate Novelties sell every year to break even? Note: Do not round intermediate calculations. The owner of GGN believes that the company can sell 12,600 chains a year. What is the margin of safety in terms of the number of chains?
You sell $5 million dollars' worth of delivery trucks to Walmart on account and offer them a 2% discount if they pay within 15 days, with the invoice due after 45 days (2/15, n/45). Unfortunately, Walmart returns all of the trucks after one week because they discover that the model you sold them is not approved for use in California. Which of the following is part of the correct journal entry to make at the time that Walmart returns the trucks? DEBIT to Sales Returns of $5 million CREDIT to Sales Discount of $100,000 CREDIT to Accounts Receivable of $4.9 million CREDIT to Sales Revenue of $5 million
Franklin Camps, Incorporated leases the land on which it builds camp sites. Franklin is considering opening a new site on land that requires $2,450 of rental payment per month. The variable cost of providing service is expected to be $6 per camper. The following chart shows the number of campers Franklin expects for the first year of operation of the new site: January February March 150 260 210 February August April 210 Price May 330 June 510 Required Assuming that Franklin wants to earn $7 per camper, determine the price it should charge for a camp site in February and August. Note: Do not round intermediate calculations. July August September October November December Total 660 660 360 390 150 310 4,200
A supermarket can purchase an automated checkout machine for $100,000 (to be paid in year 0) that has an estimated life of 5 years. Servicing and maintenance over that period will begin at $2,500 per annum ( at the end of year 1) and increase at a 10% rate every year. If the checkout machine is purchased, the supermarket will not be required to hire one additional checkout operator. The checkout operator costs $28,000 per year (assume this is also at the end of each year beginning with year 1), and this amount is expected to increase at 5% annually. If the supermarket’s cost of capital is 10%, which alternative should be selected. Assume all annual cashflows occur at the end of each year.
Star Symphony would like to perform for a neighbouring city. Fixed costs for the performance total $5,000. Tickets will sell for $15 per person, and an outside organization responsible for processing ticket orders charges the symphony a fee of $2 per ticket. Star Symphony expects to sell 500 tickets. How many tickets must Star Symphony sell to break even? How many tickets must the symphony sell to earn a profit of $7,000? How much must Star Symphony have in sales dollars to break even? How much must Star Symphony have in sales dollars to earn a profit of $7,000? What is the symphony’s margin of safety in units and in sales dollars?
The manager at the Uviewum Classic Cinema is concerned about the impact of the internet on movie attendance. They have hired you to determine the number of movie goers that must view the movie to break even on a film. Each film is played for one month at this theater. When a film is rented Uviewem must pay a $7,000 fee plus 5% of the ticket sales. The admissions price to the movie is $12.00 per person. The mall rents the space to the theater for $3,000 per month. The theater pays a manager/ticket taker $3,200 per month and the concessions workers are paid $ 1,800 per month. Assume that each moviegoer spends $7.00 on concession products and that the cost of the items consumed is $3.00. Compute the number of paying attendees (our internal control is excellent and there are no freebies) that must view the movie during the month in order to breakeven. a) List and total the fixed costs associated with showing a film at this theater? b) List and total the variable costs associated with each…
Northampton City Tours (NCT) offers personalized historical and architectural tours in a large midwestern city and the local suburbs. NCT charges $350.00 per trip to or from the airport. The variable cost for a tour totals $42.00 for fuel, driver, and so on. The monthly fixed cost for NCT is $13,860. Required: a. How many tours must NCT sell every month to break even? b. NCT's owners believe that 50 tours is a reasonable forecast of the average monthly demand. What is the margin of safety in terms of the number of tours?
Wall’s Pharmacy will have to sell a new product that has an estimated revenue of $5,100 per month and costs of $1,000 per month with an initial purchase of $28,000. How long will Wall's Pharmacy have to sell a new product if the MARR is 0% per month? Wall's Pharmacy will have to sell a new product for __ months.