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?

Question

Quizplus · Accepted Answer

To break even, Camp Gordon needs to cover its total costs (fixed + variable) with its total revenue (fees + grants + other sources). Fixed costs are $150,000, and variable costs for 350 campers are $550 * 350 = $192,500. Total costs are $150,000 + $192,500 = $342,500. Revenue from fees is $500 * 350 = $175,000, and grants are $95,000. Total revenue from fees and grants is $175,000 + $95,000 = $270,000. Therefore, Camp Gordon needs to raise $342,500 - $270,000 = $72,500 from other sources to break even.

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