Camp Gordon Has Annual Fixed Operating Costs of $150,000 and Variable

question 95

Multiple Choice

Camp Gordon has annual fixed operating costs of $150,000 and variable costs of $550 per camper.Total fees charged to campers amount to $500 each.The camp expects 350 campers next summer.Projected government grants are $95,000.How much must Camp Gordon raise from other sources to break even?

• A)$37,500
• B)$45,000
• C)$72,500
• D)$97,500

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Definitions:

Production

The process of creating goods and services through the combination of human labor, materials, and technology.

Cost Estimation

The process of forecasting the costs associated with a project or production, taking into consideration all relevant variables.

Least Squares Regression

A statistical method used to determine a line of best fit by minimizing the sum of squares of the differences between observed and predicted values.

Cost Estimation

The process of predicting the amount of resources, especially financial, required to complete a project or product development within specified constraints.