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Calculate the number of tickets BTA must sell

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Reference no: EM132995779

Question - Brisbane Travel Agency (BTA) specialises in tour tickets between Brisbane and Los Angeles. It books passengers on Virgin Australia. BTA's fixed costs are $4,000 per month. Virgin Australia charges passengers $1,100 per round-trip ticket. BTA receives a 10 per cent commission on per ticket sold. BTA's variable cost per unit related to ticket sales is $60 per ticket.

Required -

a. Calculate the number of tickets BTA must sell each month to: (i) break even in units and dollar and (ii) make a target profit of $2,500 per month?

b. What is a margin of safety? Calculate the margin of safety for BTA in April if the actual sales in April is $16,500.

c. Calculate the contribution margin ratio of BTA. By using very simplest way calculate the profit in April.

d. BTA from Virgin Australia that it will pay $65 fixed commission on per ticket to BTA. BTA's variable costs are $40 per ticket. It charges its customers a delivery fee of $5 per ticket. Calculate BEP in units and dollar and comment on the results.

Reference no: EM132995779

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