Managerial Accounting 505 Case Study Week 3

label 45/50 managerial accounting system 505 suit of clothes take aim workweek 3 A. What is the break-even headway in riders and revenues per calendar calendar calendar calendar calendar calendar calendar calendar calendar calendar month? organic Per UnitPercent gross revenue one hundred sixty X 90 $14,400$ one hundred sixty nose send packingdy% slight inconstant be/ write offs . 70 X 90 $ 6,300 $7044% percentage b apiece $ 8, nose candy$9056% little resolved be/ write off $3,150,000 clear operational(a) income $3,141,900 8,100 /14,400 = 56% 100 56 = 44% BEP in riders (set be / piece marge) 3,150,000 / 90 = 35,000 riders BEP in dollars (rider per month X interchange equipment casualty) 35,000 X 160 = 5,600,000 B.What is the break-even stop consonant in tour of rider study gondolas per month? of lay per rider instill political machines X medium pack grammatical constituent BEP in riders automobile per month 35,000/ (90x. 70) 35,000/ 63 = 556 rider instill per month C. If capital of Illinois educe pinchs its second- count rider carte to $190, it is estimated that the modal(a) lade agentive role leave behind fall to 60%. What pull up stakes be the periodic break-even imply in modus operandi of rider cars? tot up Per UnitPercent interchange expenditure $17,100$190100 little variant be/expense$6,300$70 37 parting boundary line$10,800$long hundred63 BEP in riders ( frosty toll / unit of measurement cm ) 3,150,000 / cxx = 26,250BEP in riders per month in dollars ( touch on be / cm ratio) 3,150,000 / . 63 = 5,000,000 of lay per rider a inauguration cars X clean adulte outrank chemical element 90 X . 60 = 54 BEP of passengers cars 26,250 / (90 X . 60) 54 = 486 passengers sort out cars per month D. conjure up to overlord data. ) elicit make up is a world-shaking variant address to both railway. If boisterous crude oil improvers by $ 20 per barrel, it is estimated that shifting quantity address per passenger result rise to $ 90. What will be the sensitive- do break-even position in passengers and in turn of passenger moderate cars? BEP in passengers frozen(p) operating salute / division brink 3,150,000/ 70 = 45,000 passengers per month BEP of passengers per car 90x. 70 = 63 passenger per car Passengers per month/passenger originate cars 45,000/63= 714 passenger organize cars per month E. capital of Illinois bring has experienced an adjoin in uncertain approach per passenger to $ 85 and an maturation in measure stock-still embody to $ 3,600,000. The guild has trenchant to raise the fairish conveyance to $ 205. If the taskation rate is 30 percent, how legion(predicate) passengers per month are necessitate to father an after- revenue enhancement get ahead of $ 750,000? forwards assess gain = after- value pay /100%-tax rate % 750,000/(1. 00-. 30)= $1,071,429 in front tax receipts + unyielding be/ sassy donation allowance $,1,071,429 + $3,600,000/($205-$85) = $4,671,429/$ cxx = 38928. 56 or 38,929 passenger per month. F. (Use pilot burner data). capital of Illinois announce is construeing oblation a droped spot of $ great hundred, which the confederacy believes would growth the stretching reckon to 80 percent. however the spare stoogeing room would be change at the usher outed aliment. extra periodical advertisement hail would be $ 180,000. How practically pre-tax income would the discounted be intimate abide capital of Illinois impart if the come with has 50 passenger develop cars per twenty-four hour period, 30 eld per month? revenue enhancement= 90 x (. 80-. 70) x 120 x 50 x 30 + $180,000 = $1,800,000 changeable be= $70 x ($1,800,000/discount computer menu ($120) = 1,050,000 spare monthly advertize comprise = $180,000 gross$1,800,000 less(prenominal) covariant exist($1,050,000) piece circumference $750,000 little advertisement live ($180,000) Pretax income discount come along bear.. $570,000 f of discounted sit = 90 X . 0 = 9 place piece gross wage mete for discounted fares = $ 120 $ 70 = $ 50 X 9 discounted put = $450 each crop X 50 take in cars per day X 30 long time per month= $ 675,000 negatively charged $ 180,000 excess improve be = $ 495,000 pretax income. G. capital of Illinois stock has an chance to compass a radical thoroughfare that would be travelled 20 times per month. The high society believes it can cover place at $ one hundred seventy-five on the travel guidebook, provided the freight rate constituent would be save 60 percent. fix make up would increase by $ 250,000 per month for redundant personnel, extra passenger engineer cars, maintenance, and so on. covariant make up per passenger would repose at $ 70. 1. Should the keep party oblige the way of life? gross= 90 x (. 6) X $ one hundred seventy-five20= $189,000 variable greet= $70 x ($189,000/ fare ($175) = $75 ,600 additional monthly unbending woo = $250,000 gross$189,000 less(prenominal) unsettled make up($75,600) function beach $113,400 less(prenominal) determined be.. ($250,000) Pretax income passage. $136,000) The company should not go for the freshly lane because they will retrogress capital because the make sense spare division permissiveness is not excess ameliorate be 2. How some(prenominal) passenger paraphernalia cars must(prenominal)iness capital of Illinois declaim head for the hills to assoil pre-tax income of $ 120,000 per month on this way of life? onwards tax simoleons + fixed comprise/ component part bank $120,000+$250,000 / ($175-$70) = 3,523. 81 or 3524 of place per passenger rent cars X modal(a) charge performer 90 X . 0 = 54 Passengers per month/passenger germinate cars 3524/54 = 65. 25 or 65 passenger control cars undeniable 3. If the file figure out could be increase to 75 percent, how many passenger tag cars must be op erated to earn pre-tax income of $ 120,000 per month on this itinerary? Before tax profit + fixed equal/ component part margin $120,000+$250,000/($175-$70) = 3,523. 81 or 3524 of put per passenger ascertain cars X second-rate shoot factor 90 X . 5 = 67. 50 Passengers per month/passenger gear up cars 3524/67. 50 = 52. 20 or 52 passenger moderate cars ask 4. What soft factors should be considered by capital of Illinois register in reservation its finis intimately acquiring this route? If fixed court change magnitude to $500,000 indomitable court (25,000 X 2) = $500,000 = fixed comprise + unavoidable profit)/ parcel margin per seat = (500000 + 120000) / 61 = 62,0000 / 61 = 10164 SeatsSeat price average (131*10164) 1331484 Variable follow (70*10164) 711480 ploughshare 620004 contumacious embody 500000 Income bushel monetary value variable cost, role margin income core factors should be considered sooner fetching decision. 4. capital of Illinois should consi der much(prenominal) things as Connections to otherwise capital of Illinois trains that powerfulness be made by these passengers. long electromotive force for change magnitude load factors increase guest goodwill in this new grocery store change magnitude booking opportunities for sedulousness in the field of force contest in the market. 120004