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The Leavers Hotel has annual fixed costs of $3,000,000 for its 175-room hotel, average daily room rates of $205.00, and average variable costs of $155.00 for each room rented.
The hotel operates 365 days per year.
The hotel is subject to an income tax rate of 28%.
Required
Question 1: How many rooms-nights per year must the hotel book to earn net income (after taxes) of $300,000?
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