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3. Do you think Mary James should go along with the request to alter
estimates of the percentage completion? Why or why not?
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ACCT 505 Week 3 Case Study II
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Springfield Express is a luxury passenger carrier in Texas. All seats are
first class, and the following data are available:
Number of seats per passenger train car
90
Average load factor (percentage of seats filled)
70%
Average full passenger fare
$160
Average variable cost per passenger
$70
Fixed operating cost per month
$3,150,000
What is the break-even point in passengers and revenues per month?
What is the break-even point in number of passenger train cars per
month? If Springfield Express raises its average passenger fare to $ 190,
it is estimated that the average load factor will decrease to 60 percent.
What will be the monthly break-even point in number of passenger cars?
(Refer to original data.) Fuel cost is a significant variable cost to any
railway. If crude oil increases by $ 20 per barrel, it is estimated that
variable cost per passenger will rise to $ 90. What will be the new break-
even point in passengers and in number of passenger train cars?