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A traveling production of Grease performs each year. The average show sells 1,000 tickets at $80 per ticket. There are 150 shows a year. The show has a cast of 50, each earning an average of $400 per show. The cast is paid only after each show. The other variable expense is program-printing expenses of $7 per guest. Annual fixed expenses total $950,000. The tax rate for the company is 40 percent.
Required:Compute the earnings after tax for 150 shows.Compute the number of shows needed annually to break even.Compute the number of shows needed annually to earn a net income of $6,000,000.
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