please explain the answer e Best Appliances had the following revenue over the p

Question

please explain the answer

e Best Appliances had the following revenue over the past five years: 2013 2014 2015 2016 2017 $ 600,000 700,000 900,000 800,000 1,000,000 To predict revenues for 2018, The Best Appliances uses the average for the past ive years. The company's breakeven revenue is $800,000 per year. What is The Best Appliances's predicted margin of safety in dollars for 2018? a. $800,000 b. $O c. $200,000 d. $100,000 I. Rocky Mountain Waterpark sells half of its tickets for the regular price of $75. The other half go to senior citizens and children for the discounted price of $35. Variable cost per guest is $15 for both groups, and fixed costs total $60,000 per month. What is y Mountain's breakeven point in total guests? Regular guests? Discount guests? a. 2,000; 1,000; 1,000 b. 800, 400; 400 c. 750; 375; 375 d. 1,500; 750; 750

Explanation / Answer

9. b. $0

Predicted revenue= Total sales/5 =4,000,000/5 = 800,000

Margin of safety = Sales - breakeven sales

= 800,000-800,00=0

10. d: 1500,750,750

Breakeven point = Fixed cost/ contribution

=60,000/80=750

So, Total guest = 750*2=1500

Regular guest= 750*1=750

Discounted guest= 750*1=750

Year Sales 2013        600,000.00 2014        700,000.00 2015        900,000.00 2016        800,000.00 2017    1,000,000.00 Total    4,000,000.00

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