Question

Park competes with Cool World by providing a variety of rides. Sillyday sells tickets at $ 125 per person as a​ one-day entrance fee. Variable costs are $ 75 per​ person, and fixed costs are $ 325 comma 000 per month. Compute Sillyday ​Park's contribution margin ratio. Carry your computation to two decimal places. Use the contribution margin ratio approach to determine the sales revenue Sillyday Park needs to break even.

Answer 1

$50

6500

Step-by-step explanation:

Contribution margin = price - per unit variable cost

$125 - $75 = $50

breakeven = fixed cost / contribution margin

= $325,000 / $50 = 6500