Springfield Express is a luxury passenger carrier in Texas. All seats are first class‚ and the following data are available: Number of seats per passenger train car 90 Average load factor (percentage of seats filled) 70% Average full passenger fare $ 160 Average variable cost per passenger $ 70 Fixed operating cost
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A Acct 505 Case Study 1 Springfield express is a luxury passenger carrier in Texas. All seats are first class‚ and the following data are available: |Number of seats per passenger train car | |90 | |Average load factory (percentage of seats filled) |70% | |Average full passenger fare | | |$160 | |Average variable cost per passenger
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passengers Unit of Sales = 35‚000 x $160= $5‚600‚000 revenue B) What is the break-even point in number of passenger train cars per month? Unit of Sales = 35‚000/63= 555.5= 556 passenger cars C) If Springfield Express raises its average passenger fare to $ 190‚ it is estimated that the average load factor will decrease to 60 percent. What will be the monthly break-even point in number of passenger cars? 90 x .60 = 54
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Ronice M. Bruce Week 3_Course Project A - CASE STUDY ACCT 505- Prof Main January 26‚ 2013 Springfield Express is a luxury passenger carrier in Texas. All seats are first class‚ and the following data are available: Number of seats per passenger train car 90 Average load factor (percentage of seats filled) 70% Average full passenger fare $160 Average variable cost per passenger $70 Fixed operating cost per month $3‚150‚000 a. What is the break-even point in passengers and revenues
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AC505 Practice Quiz #1 1. For which of the businesses would the job order cost system be appropriate? a. Auto repair shop b. Crude Oil refinery. c. Drug Manufacturer. d. Root beer producer. 2. Which of the following companies would most likely use job costing? a. Paper manufacturer. b. Paint Producer. c. Breakfast cereal maker. d. Advertising agency. 3. An equivalent unit of conversion costs is equal to the amount of conversion costs required to: a. Start a unit. b. Start and complete
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breakeven (X) Sales per unit. 35‚000 x $160 = $5‚600‚000 • What is the break-even point in number of passenger train cars per month? At 70% load = 90 x 70% = 63 Breakeven point in passengers = 35‚000/63 = 556 cars c) If Springfield Express raises its average passenger fare to $ 190‚ it is estimated that the average load factor will decrease to 60 percent. What will be the monthly break-even point in number of passenger cars? 90 seats x 60% = 54 Contribution Margin
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What is the break-even point in number of passenger train cars per month? # of seats per passenger train cars X Average load factor BEP in passenger’s car per month 35‚000/ (90x.70) 35‚000/ 63 = 556 passenger train per month C. If Springfield Express raises its average passenger fare to $190‚ it is estimated that the average load factor will decrease to 60%. What will be the monthly break-even point in number of passenger cars? Total Per Unit Percent Selling Price $17‚100
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AC505 Part B Capital Budgeting problem Clark Paints Cost of new equipment $200‚000 Expected life of equipment in years 5 Disposal value in 5 years $40‚000 Life production - number of cans 5‚500‚000 Annual production or purchase needs 1‚100‚000 Initial training costs Number of workers needed 3 Annual hours to be worked per employee 2‚000 Earnings per hour for employees $12 Annual health benefits
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Additional Problems and Cases Chapter 1 Extra Problems/Cases 41. What is the difference between a parameter and a decision variable in a mathematical model? 42. Discuss how a spreadsheet can facilitate the development of a model shell and the model itself. 43. United Airlines faces not only the situations described in the opening vignette to this chapter‚ but many other problems as well. Give five examples of optimization models and five examples of prediction models that you feel would be relevant
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Case Study 1 Springfield Express is a luxury passenger carrier in Texas. All seats are first class‚ and the following data are available: Number of seats per passenger train car 90 Average load factor (percentage of seats filled) 70% Average full passenger fare $ 160 Average variable cost per passenger $ 70
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