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Calculate the number of units of service required

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Marvel Pty Ltd is a theme park located near Penrith NSW. For one night accommodation per person, Marvel charges $60. Marvel estimates that the variable cost per person is $30, which includes food and room services. The fixed cost is estimated to be $56,000 per year.

Required:

Calculate

Question (1) The contribution margin per unit of service (the per unit of service is one night accommodation for one guest) and the contribution margin ratio

Question (2) The annual breakeven point in dollars

Question (3) Assuming the motel targets a net profit of $64,000 a year before tax, calculate the number of units of service required to reach this target.

Reference no: EM132859234

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