Millbridge Animal Protective Services (MAPS) is planning its spring awards dinner as a fundraising event. It is planning to charge each attendee $150. Feast Hall, the site of the dinner, will charge MAPS $5,000 for the use of its posh VIP Room and $50 per plate for food. The VIP Room has a capacity of 180 people. Rocky Mount and the Tar Heels (one band) will provide the entertainment for their standard performance fee of $1,000 per night.
a. How many people would need to attend in order for MAPS to break even?
b. If MAPS sells 100 tickets for the dinner, what is the average cost to MAPS for each person with a ticket?
The break-even point can be calculated by dividing the fixed cost with the contribution margin per unit. The contribution margin is the calculator by directing the variable cost from the sales price of the product.
Answer and Explanation: 1
Collection fee per attendee= $150
Variable cost per attendee= $50
VIP room cost = $5,000
Entertainment for night = $1,000
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fromChapter 5 / Lesson 28
See how to calculate break-even point (in units and dollars). See the variables of the break-even point formula and examples. Understand the purpose of break-even analysis.