Media outlets such as ABS-CBN and GMA-7 often have Web sites that provide in-depth coverage of news and events. Portions of these Web sites are restricted to members who pay a monthly subscription to gain access to exclusive news and commentary. These Web sites typically offer a free trial period to introduce viewers to the Web site. Assume that during a recent fiscal year, ABS-CBN.com spent P1, 800,000 on a promotional campaign for the ABS-CBN.com Web site that offered two free months of service for new subscribers. In addition, assume the following information: Determine the number of new customer accounts needed to break even on the cost of the promotional campaign. In forming your answer, treat the cost of the promotional campaign as a fixed cost, and treat the revenue less variable cost per account for the subscription period as the unit contribution margin.Show transcribed image text Media outlets such as ABS-CBN and GMA-7 often have Web sites that provide in-depth coverage of news and events. Portions of these Web sites are restricted to members who pay a monthly subscription to gain access to exclusive news and commentary. These Web sites typically offer a free trial period to introduce viewers to the Web site. Assume that during a recent fiscal year, ABS-CBN.com spent P1, 800,000 on a promotional campaign for the ABS-CBN.com Web site that offered two free months of service for new subscribers. In addition, assume the following information: Determine the number of new customer accounts needed to break even on the cost of the promotional campaign. In forming your answer, treat the cost of the promotional campaign as a fixed cost, and treat the revenue less variable cost per account for the subscription period as the unit contribution margin.
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