Anu’s amusement center has collected the following data for operations for the year. total revenues $ 1,980,000 total fixed costs $ 652,400 total variable costs $ 1,056,000 total tickets sold 66,000 required: a. what is the average selling price for a ticket? b. what is the average variable cost per ticket? c. what is the average contribution margin per ticket? (do not round intermediate calculations.) d. what is the break-even point? (do not round intermediate calculations.) e. anu has decided that unless the operation can earn at least $306,600 in operating profits, she will close it down. what number of tickets must be sold for anu’s amusements to make a $306,600 operating profit for the year on ticket sales? (do not round intermediate calculations.)

a. Average selling price per unit = $30

b. Average variable cost = $16

c. Average Contribution margin per ticket = $14

d. Break Even Point = 46,600 Tickets

e. For profit of $306,600 = 68,500 tickets

Explanation:

As for the provided information we have,

a. Average selling price per unit =

Provided total sales revenue = $1,980,000

Number of units = $66,000

Thus, average selling price = = $30 per unit.

b. Average variable cost =

Provided total variable cost = $1,056,000

Number of units = $66,000

Thus, average variable cost per unit = = $16 per unit

c. Average Contribution margin per ticket = Average selling price per ticket - Average variable cost per ticket = $30 - $16 = $14 per unit.

Alternatively it can be calculated as =

d. Break Even Point =

Fixed cost = $652,400

Contribution per unit = $14 per unit

Break even point = = 46,600 Tickets

e. In this case desired profit = $306,600

Fixed cost = $652,400

Total amount to be recovered through contribution = $306,600 + $652,400 = $959,000

Thus, number of tickets to be sold =

That is 68,500 tickets.

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