Pretend you are the CFO of United Airlines. Your calculations show that a flight from DC to Los Angeles costs the company
$200 per passenger (assume of the sake of simplicity that everyone is riding economy class and all seats are priced the same regardless if it’s aisle, window, or advance booking). The $200 covers airport fees, gas, the labor costs of having the pilot etc
You normally sell tickets for $400 through your company’s web site.
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One customer gets a discounted price of $300 because he’s a repeat customer
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One customer throws a temper tantrum and gets a free seat on a full flight.
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One off-duty flight attendent takes a seat on a half-empty flight for leisure reasons as part of her employee benefits.
How are those 3 examples reflected in the income statements?