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Break-Even Sales and Sales Mix for a Service Company
Sunshine Airways provides air transportation services between Philadelphia and Orlando. A single Philadelphia to Orlando round-trip flight has the following operating statistics:
It is assumed that the fuel, crew salaries, and airplane depreciation are fixed, regardless of the number of seats sold for the round-trip flight. a. Compute the break-even number of seats sold on a single round-trip flight for the overall product. Assume that the overall product is 10% business class and 90% economy class seats. Total number of seats at break-even: seats b. How many business class and economy class seats would be sold at the break-even point? Business class seats at break-even: seats Economy class seats at break-even: |
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