Suppose a Best Western Motel Has Annual Fixed Costs Applicable

question 43

Multiple Choice

Suppose a Best Western motel has annual fixed costs applicable to its rooms of $1.2 million for its 300- room motel, average daily room rents of $50, and average variable costs of $10 for each room rented. It operates 365 days per year. The amount of net income on rooms that will be generated if the motel is half full throughout the entire year is:

• A) $(1,192,500)
• B) $1,590,000
• C) $990,000
• D) $2,737,500

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Definitions:

Authority

The power or right to give orders, make decisions, and enforce obedience.

Winter Job Program

A government or organizational initiative designed to provide employment opportunities during the winter months, often in areas affected by seasonal unemployment.

Equitably

In a manner that is fair, just, and impartial, ensuring equal treatment or opportunities for all.

Tardy Students

Students who arrive late to class, which may reflect on their punctuality, responsibility, or situational factors affecting them.