Northern Cruiseline offershtly dinner cruises off the coast of Nanaimo and Victoria. Dinner cruise tickets...
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Northern Cruiseline offershtly dinner cruises off the coast of Nanaimo and Victoria. Dinner cruise tickets sell for $ per passenger. Northern Cruiselines variable cost of providing the dinner is $ per passenger, and the fixed cost of operating the vesselsdepreciation salaries, docking fees, and other expenses is $ comma per month. Under these conditions, the breakeven point in tickets is comma and the breakeven point in sales dollars is $ comma
Suppose Northern Cruiseline embarks on a costreduction drive and slashes fixed expenses from $ comma per month to $ comma per month.
Compute the new breakeven point in units and in sales dollars.
Is the breakeven point higher or lower than under the original conditions? Explain how changes in fixed costs generally affect the breakeven point.
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