ABC Tours is organizing a 5 day trip to Toronto. For this particular five-day trip, it will cost the ABC Tours the following: Bus and driver $1,500/day Marketing Meals per person/day $5,00 (brochure and newspapers) $5.00 (4 breakfasts) $20.00 (5 dinners) $120.00 (4 nights) Hotel rooms (night) Events/attractions $25.00 (per event for a total of 7 events) $1,000 Other fixed costs Miscellaneous variable costs $100 (per person) Price per client $1,700 Travel guide $500/day Questions With the above information, calculate the following: 1. Total fixed costs 2. Variable costs (per client) 3. Contribution margin (per client)

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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ABC Tours is organizing a 5 day trip to Toronto. For this particular five-day trip, it will
cost the ABC Tours the following:
$1,500/day
Bus and driver
Marketing
Meals per person/day
$5,00 (brochure and newspapers)
$5.00 (4 breakfasts)
$20.00 (5 dinners)
$120.00 (4 nights)
Hotel rooms (night)
Events/attractions
$25.00 (per event for a total of 7 events)
$1,000
Other fixed costs
Miscellaneous variable costs
$100 (per person)
Price per client
$1,700
Travel guide
$500/day
Questions
With the above information, calculate the following:
1. Total fixed costs
2. Variable costs (per client)
3. Contribution margin (per client)
4. PV ratio
5. The number of clients needed to break-even
6. The number of clients needed if Parkway wants to generate a $5,000 profit
Transcribed Image Text:ABC Tours is organizing a 5 day trip to Toronto. For this particular five-day trip, it will cost the ABC Tours the following: $1,500/day Bus and driver Marketing Meals per person/day $5,00 (brochure and newspapers) $5.00 (4 breakfasts) $20.00 (5 dinners) $120.00 (4 nights) Hotel rooms (night) Events/attractions $25.00 (per event for a total of 7 events) $1,000 Other fixed costs Miscellaneous variable costs $100 (per person) Price per client $1,700 Travel guide $500/day Questions With the above information, calculate the following: 1. Total fixed costs 2. Variable costs (per client) 3. Contribution margin (per client) 4. PV ratio 5. The number of clients needed to break-even 6. The number of clients needed if Parkway wants to generate a $5,000 profit
ABC Tours is organizing a 5 day trip to Toronto. For this particular five-day trip, it will
cost the ABC Tours the following:
$1,500/day
Bus and driver
Marketing
Meals per person/day
$5,00 (brochure and newspapers)
$5.00 (4 breakfasts)
$20.00 (5 dinners)
$120.00 (4 nights)
Hotel rooms (night)
Events/attractions
$25.00 (per event for a total of 7 events)
$1,000
Other fixed costs
Miscellaneous variable costs
$100 (per person)
Price per client
$1,700
Travel guide
$500/day
Questions
With the above information, calculate the following:
1. Total fixed costs
2. Variable costs (per client)
3. Contribution margin (per client)
4. PV ratio
5. The number of clients needed to break-even
6. The number of clients needed if Parkway wants to generate a $5,000 profit
Transcribed Image Text:ABC Tours is organizing a 5 day trip to Toronto. For this particular five-day trip, it will cost the ABC Tours the following: $1,500/day Bus and driver Marketing Meals per person/day $5,00 (brochure and newspapers) $5.00 (4 breakfasts) $20.00 (5 dinners) $120.00 (4 nights) Hotel rooms (night) Events/attractions $25.00 (per event for a total of 7 events) $1,000 Other fixed costs Miscellaneous variable costs $100 (per person) Price per client $1,700 Travel guide $500/day Questions With the above information, calculate the following: 1. Total fixed costs 2. Variable costs (per client) 3. Contribution margin (per client) 4. PV ratio 5. The number of clients needed to break-even 6. The number of clients needed if Parkway wants to generate a $5,000 profit
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ME EXERCISE 4: IDENTIFYING FIXED AND VARIABLE COSTS AND CALCULATING THE
CONTRIBUTION MARGIN AND THE PV RATIO
Parkway Travel Tours is organizing a five-day trip from Toronto to Branson, Missouri,
a family town with all types of attractions and theatres. Although it is a small town
(around 10,000 people), Branson attracts millions of visitors every year.
Branson hosts more than 100 live shows in 52 state-of-the art theatres. For this
particular five-day trip, it will cost the agency the following:
Buss and driver
Travel guide
Advertising
Meals per person/day
Hotel rooms (night)
Events/attractions
Other fixed costs
Miscellaneous variable costs
Price per
client
$2,500/day
$500/day
$1,000 (brochure and newspapers)
$5.00 (4 breakfasts)
$20.00 (5 dinners)
$60.00 (4 nights)
$40.00 (per event for a total of 7 events)
$1,000
$100 (per person)
$1,700
V3 Questions AD OMA RAJUDS
TAJUDJAD
With the above information, calculate the following:
1. Total fixed costs
2. Variable costs (per client)
3. Contribution margin (per client)
4. PV ratio
R3X3
5. The number of clients needed to break-even
6. The number of clients needed if Parkway wants to generate a
$5,000 profit
nint the cash break-even point, and the profit
Transcribed Image Text:ME EXERCISE 4: IDENTIFYING FIXED AND VARIABLE COSTS AND CALCULATING THE CONTRIBUTION MARGIN AND THE PV RATIO Parkway Travel Tours is organizing a five-day trip from Toronto to Branson, Missouri, a family town with all types of attractions and theatres. Although it is a small town (around 10,000 people), Branson attracts millions of visitors every year. Branson hosts more than 100 live shows in 52 state-of-the art theatres. For this particular five-day trip, it will cost the agency the following: Buss and driver Travel guide Advertising Meals per person/day Hotel rooms (night) Events/attractions Other fixed costs Miscellaneous variable costs Price per client $2,500/day $500/day $1,000 (brochure and newspapers) $5.00 (4 breakfasts) $20.00 (5 dinners) $60.00 (4 nights) $40.00 (per event for a total of 7 events) $1,000 $100 (per person) $1,700 V3 Questions AD OMA RAJUDS TAJUDJAD With the above information, calculate the following: 1. Total fixed costs 2. Variable costs (per client) 3. Contribution margin (per client) 4. PV ratio R3X3 5. The number of clients needed to break-even 6. The number of clients needed if Parkway wants to generate a $5,000 profit nint the cash break-even point, and the profit
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