Maximizing Profit Margins: Strategies for Achieving Targeted

School: CUNY LaGuardia Community College - Course: ACCOUNTING 350 - Subject: Accounting

1 Weekly Revenue : 55000 partons * $35 per parton ### Desired profit margins:35% ### Targeted weekly cost ### Targeted cost per patron: $ 22.75 (1251250 /55000) Target Weekly Cost Ticket sales and verification: 3.35 * 55000### Operating attractions: 90* 11340 ### Litter patrol : 1750 * 20 $ 35,000 Total weekly cost ### Cost per patron ( 1239850 /55000) $ 22.54 Operating profits : $1925000 -1239850 ###

Lagon achieves its target profit of 35% of revenue 2 Weekly Revenue: 55000 * 33 ### Weekly Cost Ticket sales and verification 3* 55000 ### Operating attractions: 10340 *90 ### Litter patrol: 1750 *80% * 20 + 250 $ 28,250 Total weekly costs ### Operating Profits : 1815000 -1123850### If so, the profit is greater then Lagon's current profitabilty. 3 The chanenges Lafon may encounter about the employee. If the employees resist the changes, or implementation of the improvements, the target cost will be in danger of not being met. 4 Weekly Revenue : 55000 partons * $35 per parton ### Desired profit margins:35% ### Targeted weekly cost ### Targeted cost per patron: $ 22.75 (1251250 /55000) Target Weekly Cost Ticket sales and verification: 3.35 * 55000### Operating attractions: 90* 11340 ### Carbon tax: 3* 11340 $ 34,020 Litter patrol : 1750 * 20 $ 35,000 Total weekly cost ### Cost per patron ( 1273870 /55000) $ 23.16 Operating profits : $1925000 -1273870 ### $651130 / 1925000 =34% If there has carbon tax $3, it can't achieve the target operating income 35% * 1925000 = 673750 If want to achieve the target operating income, the operating profits will be: $673750 and the weekly cost need to be: 1925000 -673750 =###