Southwestern College is planning to hold a fund raising banquet at one of the local country clubs. It has two options for the banquet:
OPTION 1: Crestview Country Club
a. Fixed rental cost of $1,000
b. $12 per person for food
OPTION 2: Tallgrass Country Club
a. Fixed rental cost of $3,000
b. A caterer who charges $8.00 per person for food
Southwestern College has budgeted $1,800 for administrative and marketing expenses. It plans to hire a band which will cost another $800. Tickets are expected to be $30 per person. Local business supporters will donate any other items required for the event.
-What is the operating income for each option if 600 people attend?
A) $14,400 and $12,400 respectively
B) $9,800 and $10,200 respectively
C) $7,900 and $8,000 respectively
D) $7,200 and $7,600 respectively
Correct Answer:
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