Response to the following problem:
Consider the Grand Canyon Railway example . Suppose the railway decides to offer Coach class service at an all-inclusive round-trip ticket price of $60 per passenger. Assume variable expenses of $20 per passenger. If Grand Canyon has $275,000 of fixed expenses per month, compute the number of roundtrip tickets it must sell to break even:
a. Using the income statement equation approach
b. Using the shortcut contribution margin CVP formula
Perform a numerical proof to ensure that your answer is correct.