Business, 02.03.2020 21:07 ayoismeisalex

Carriage Company offers guided horse-drawn carriage rides through historic Charleston, South Carolina. The carriage business is highly regulated by the city. Carlton Carriage Company has the following operating costs during April: During April (a month during peak season) Carlton Carriage Company had 12,990 passengers. Eighty-five percent of passengers were adults

($23 fare) while 15% were children ($15 fare).

DATA TABLE:

Monthly depreciation expense on carriages and stable. . . . . . .$2,400

Fee paid to the City of Charleston. . . . . . . . . . . . . 15% of ticket revenue

Cost of souvenir set of postcards given to each passenger. . . . . . .$0.75/set of postcards

Brokerage fee paid to independent ticket brokers (60% of tickets are issued through these brokers; 40% are sold directly by the Carlton Carriage Company). . . . . . $1.60/ticket sold by broker

Monthly cost of leasing and boarding the horses. . . . . . . . . . . .$53,000

Carriage drivers (tour guides) are paid on a per passenger basis. . . . . . . . . . . $3.30 per passenger

Monthly payroll costs of non-tour guide employees. . . . . . . . . . . . . . . . .$7,550

Marketing, Web site, telephone, and other monthly fixed costs. . . . . . . . . . . . . . . . . . . . $7,450

Requirements

1.

Prepare the company's contribution margin income statement for the month of April. Round all final figures to the nearest dollar.

2.

Assume that passenger volume increases by
20% in May. 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 April?

Requirement 1. Prepare the company's contribution margin income statement for the month of April. (Do not round interim calculations or amounts. Round all amounts input in the table to the nearest dollar. Check your spelling carefully and do not abbreviate.)

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