## A Best Eastern Motel is a regional motel chain. Its rooms rent for $90 per night, on average. The variable cost is $40 a room per night. Fix

Question

A Best Eastern Motel is a regional motel chain. Its rooms rent for $90 per night, on average. The variable cost is $40 a room per night. Fixed costs are $1,200,000 per year. What is the breakeven point?

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2021-12-27T10:54:07+00:00
2021-12-27T10:54:07+00:00 2 Answers
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## Answers ( )

Answer:break even point (y) = 24000Step-by-step explanation:This is quite simple to solve,

We will take a step by step calculation.

let us begin;

Given that the Room rent per night is = $90

Also the variable cost per night = $40

Total fixed cost = $1200,000

Now we are asked to solve for the Break even point;

Remember that at break even point, the Revenue = cost

Say the required revenue from renting y rooms R = $90y

The cost of renting y rooms = C = $ (40y + 1200,000)

therefore from this we have the Break even point as

$90y = $ (40y + 1200,000)

where y = 24000

cheers i hope this helps!!!!!!

Answer:24,000 unitsStep-by-step explanation:Breakeven point = Fixed Costs / sales price by unit – variable cost by unitBEP = 1,200,000 / 90 – 40BEP = 1,200,000 / 50BEP = 24,000 unitsThen we get BEP at 24,000 room during the whole yearIf the chain consist of 68 motels, then they need to have full occupancy during the whole year