Famous Productions performs London shows. The average show sells 900 tickets at $ 65 per ticket. There are 115 shows per year. No additional shows can be held as the theater is also used by other production companies. The average show has a cast of 55 , each earning a net average of $ 330 per show. The cast is paid after each show. The other variable cost is a program-printing cost of $ 9 per guest. Annual fixed costs total $ 580 comma 500.

Compute revenue and variable costs for each show.

Question

Business

Kendall Poole

28 June, 01:40

Famous Productions performs London shows. The average show sells 900 tickets at $ 65 per ticket. There are 115 shows per year. No additional shows can be held as the theater is also used by other production companies. The average show has a cast of 55 , each earning a net average of $ 330 per show. The cast is paid after each show. The other variable cost is a program-printing cost of $ 9 per guest. Annual fixed costs total $ 580 comma 500.

Compute revenue and variable costs for each show.

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Answers (1)

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Leslie Baker · Answer 1

Instructions are listed below.

Explanation:

Giving the following information:

The average show sells 900 tickets at $ 65 per ticket. The average show has a cast of 55 , each earning a net average of $ 330 per show. The cast is paid after each show. The other variable cost is a program-printing cost of $ 9 per guest. Annual fixed costs total $580,500.

Unitary variable cost = 55*$330 + $9*900 = $26,250

Unitary fixed costs = 580,550/115 shows = $5,048

Income statement:

Sales = 900*65 = $58,500

Unitary variable cost = (26,250)

Contribution margin = $32,250

Unitary Fixed costs = 5,048

Operating income = $27,202