The Sandhill Acres Inn is trying to determine its break-even point during its off-peak season. The inn has 50 rooms that it rent at $120 a night. Operating costs are as follows:
Salaries
$5400 per month
Utilities
$1300 per month
Depreciation
$1100 per month
Maintenance
$2520 per month
Maid service
$33 per room
Other costs
$63 per room
a/ Determine the inn’s break-even point in number of rented rooms per month.
b/Determine the inn’s break-even point in dollars.
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