The Lake Shore Inn is trying to determine its break-even point. The inn has 50 rooms that are rented at $60 per night. Operating costs are as follows:
Salaries $7,200 per month Utilities $1,500 per month Depreciation $1,200 per month Maintenance $300 per month Maid Service $8 per room Other Costs $28 per room
Determine the inn's break-even point in (1) number of rented rooms per month and (2) dollars.
Break-even number of rooms rented per month:___
Break-even sales dollars:__
Fixed Costs / Contribution Margin per Unit (Unit selling price - Unit Variable Costs) = Break-even point in Units.
Fixed Costs / Contribution Margin Ratio (Contribution Margin per Unit / Unit selling price) = Break-even point in Dollars.