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Calculate contribution margin per unit and ratio

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Reference no: EM132613202

Question - Anjung Singgah Hotel is a small hotel located in Batu Caves, Selangor. The charge is RM50 per guest for one night's lodging and a full breakfast in the morning. Puan Salwa who own and manage the hotel estimate that the variable expenses per guest is RM20. This includes such expenses as food, maid service and utilities. The Hotel's fixed expenses total RM42,000 per year.

Required -

a) Calculate contribution margin per unit and ratio.

b) Calculate the number of guests needed to break even (in unit and in RM).

c) Calculate the number of guests that the Hotel must have to earn a profit of RM60,000 for the year.

d) Calculate the profit earned if there are 2,000 guests.

e) The price the Hotel should charge if the Hotel wants to earn a profit of RM60,000 from 2,000 guests, and all the costs remain as stated.

Reference no: EM132613202

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