Solution-What additional flight miles would need to be flown

What additional flight miles would need to be flown

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Reference no: EM132983138

Problem 1: If High Point were to incur another $100,000 of fixed costs, what additional flight miles would need to be flown at the $9.00 flight-mile revenue rate to keep the company at a financial breakeven level?

New FC = $840,000 + $100,000 = $940,000

New Breakeven flight miles = Annual fixed cost / (RR - VC)

= $940,000 / ($9.00 - $6.00) = 313,333 flight miles

Breakeven Annual Flight Miles = 313,333 flight miles

If fixed costs increased by $100,000 a total of ______ flight miles would be required with an additional 313,333 flight miles over Grace's original calculation of 280,000 flight miles.

Reference no: EM132983138

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What additional flight miles would need to be flown

Reference no: EM132983138

Reference no: EM132983138

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