Golden Age Retirement Planners specializes in providing financial advice for people planning for a comfortable retirement. The company offers seminars on the important topic of retirement planning. For a typical seminar, the room rental at a hotel is $1,000, and the cost of advertising and other incidentals is about $10,000 per seminar. The cost of the materials and special gifts for each attendee is $60 per person attending the seminar. The company charges $250 per person to attend the seminar as this seems to be competitive with other companies in the same business. How many people must attend each seminar for Golden Age to break even

Hi, first we need to add up all fixed costs and expenses (Room rental+Advertising) and find the contribution margin (Price - Variable costs). The math to this is as follows.

[tex]Break EvenPoint(units)=\frac{Fixed Costs}{(Price-VariableCost)}[/tex]

[tex]Break EvenPoint(units)=\frac{11000}{(250-60)}=58 people[/tex]

[tex]BreakEvenPoint(Dollars)=58persons*\frac{250}{person} =14500[/tex]

Parrain Parrain · Answer 2 · 2022-04-01T11:58:21+02:00

Based on the various costs to be incurred by Golden Age Retirement Planners, the breakeven number of people will be 58 people.

What will be the breakeven number of people?

First find the fixed costs:

= Cost of room + Cost of advertising

= 1,000 + 10,000

= $11,000

The breakeven point is:

= Fixed costs / (Charge - Variable cost)

= 11,000 / (250 - 60)

= 57.9

= 58 people

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