Case Study

1) perileven Point shifting expenses Cleaning supplies linen supplies 1/2 of miscellaneous Contribution delimitation Income Statement sum up Per unit of measurement of measurement % Revenue Revenue $160,800 $20.94 100% Variable Expenses Cleaning Supplies1,920.000.251 Linen service13,920.001.819 Misc expense3,657.000.482 Total Variable expenses$19,497 2.5412 Contribution Margin $160,800-19,497= $141,303 $141,303/160,800= 88% 20.94*88%=$18.43 Fixed Expenses Salarys17,400 Desk clerk2,880 Maids7,200 Payroll taxes5,496 Depreciation30,000 Property taxes4,000 damages3,000 Repairs/main17,204 Utilities6,360 elicit on mrtg21,716 Misc Exp3,657 Total obstinate$118,913 earn b/f fed taxes $22,390, Federal income tax 48% $10,747 $22,390-10,747= $11,643 NP Per unit calculation 120 geezerhood*80 rooms* 80% rental rate = 7,680 rooms Break even in units sold = Fixed expenses/unit function $118,913/18.40=$6462.66/120 days=53.

8 units Therefore 54 rooms must(prenominal) be rented each wickedness during ski season for the hotel to abatement even. 2) Increasing rate by $5 on pass nights $5 amplify 72 rooms rented a night(72/80) = 90% occupancy 34 weekend nights 86 weekday nights $5*34weekend nights*72= $12,240 additional receipts Lost revenue 8*34=272 rooms not rented*20.94(revenue per unit)=$5,695.68 Revenue would increase by $12,240-5,695.68=$6,544.32 Total revenue increases by $167,344.32, variable expenses change because of 90% occupancy on the weekends and fixed stay the same....If you want to take down a right essay, order it on our website: OrderEssay.n et

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