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British Productions_CVP Analysis

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Question;British ProductionsBritish Productions performs London shows.;The average show sells 900 tickets at $65 per ticket. There are 155 shows a;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 program-printing cost of $9 per guest. Annual fixed costs total;$580,500.;Requirements;1.;Compute revenue and variable;costs for each show.;2.;Use the income statement and;equation approach to compute the number of shows British Productions must;perform each year to break even.;3.;Use the contribution margin;approach to compute the number of shows needed each year to earn a profit of;$4,128,000. Is this profit goal realistic? Give your reasoning.;4.;Prepare British Productions?;contribution margin income statement for 155 shows performed in 2012. Report;only two categories of costs: variable and fixed.

 

Paper#38242 | Written in 18-Jul-2015

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