To raise funds for its community activities a Lions Club

#3861
To raise funds for its community activities, a Lions Club chapter is negotiating with International
Carnivals to bring its midway rides and games to town for a three-day opening. The event will
be held on part of the parking lot of a local shopping centre, which is to receive 10% of the
gross revenue. The Lions Club members will sell the ride and game tickets at the site.
International Carnivals requires either $15,000 plus 30% of revenue or $10,000 plus 50% of
revenue. The experience of other towns that have held the event is that customers spend an
average of $10 per person on rides and games.a. What is the break-even attendance under
each basis for remunerating International Carnivals?b. For each alternative, what will be the
club’s profit or loss if the attendance is:(i) 3000?(ii) 2200?c. How would you briefly explain the
advantages and disadvantages of the two alternatives to a club member?View Solution:
To raise funds for its community activities a Lions Club

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