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Use the Formula below:

Profit = Revenue (Sales) – Total Cost

Total Cost = Fixed Cost + Variable Cost

Break-even occurs when the revenue equals to the total cost, at 0 profit (Revenue (Sales) = Total Cost)

 

1. How many paying customers do we need to break even for the Event A below.

2. If the Event A organizer plans to make a profit of $35,0000, how many paying customers are needed?

Event A

The admission price: $8.00

Fixed cost: $25,000.00

Each patron generates $2.00 in additional costs

 

 

3. The Event B organizer needs to decide the admission price. Calculate the admission price to break even.

4. If the admission ticket sets at $10.00, how much is the profit of Event B?

 

Event B

Fixed cost: $36,000.00

Variable cost: $2.00 per attendee

Estimated attendance: 12,000 attendance

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