Reference no: EM132113011
Question - Mr Zoo is planning to set up a mini Zoo in Howick.
The following relates to different pricing plans of visiting the zoo and costs of running the zoo.
Pricing Plan 1 - $30 per person (a special pack will be included)
Pricing Plan 2 - $25 per visitor (the special pack not to be included)
Variable Costs per visitor
Special Pack - 8%
Zoo Consumables - $7
Zoo Expenses - $2
Total Fixed Costs - $200,000
REQUIRED: Study the information above then answer the following questions.
Using the CVP formula, calculate the number of units (and its KINA amount) for achieving
1) Breakeven
2) A profit of $30,000 for both plans.
3) Calculate the Contribution Margin ratio for both plans.