55) Jetboat Tours Company offers guided jet boat rides on the Ottawa River. The tour business is highly regulated by the municipal government. Jet Boat Tours Company has the following operating costs during July:
Monthly depreciation expense on equipment$7,625
Fee paid to the Municipal Government for docking etc16% of ticket revenue
Cost of souvenir set of postcards given to each passenger $2.50/set of postcards
Brokerage fee paid to independent ticket brokers:
(65% of tickets are issued through these brokers; 35% are sold
directly by the Jetboat Tours Company) .50/ticket sold by broker
Monthly cost of leasing jet boats3,000
Boat operators (tour guides) are paid on a per passenger basis.5.00 per passenger
Monthly payroll costs of non—tour guide employees$15,650
Marketing, website, telephone, and other monthly fixed costs.$13.480
During July (a month during peak season) Jetboat Tours Company had 31,060 passengers. Eighty-five percent of passengers were adults ($35 fare) while 15% were children ($22 fare).
Requirements
1.
Prepare the company's contribution margin income statement for the month of April. Round
all figures to the nearest dollar.
2.
Assume that passenger volume increases by 12% in August. Which figures on the income
statement would you expect to change, and by what percentage would they change? Which
figures would remain the same as in July?