Not-for-Profit Applications (LO3)

Determine the solution to each of the following independent cases:

a. Hillside College has annual fixed operating costs of $12,500,000 and variable operating costs of

$1,000 per student. Tuition is $8,000 per student for the coming academic year, with a projected enrollment of 1,500 students. Expected revenues from endowments and federal and state grants total $250,000. Determine the amount the college must obtain from other sources.

b. The Hillside College Student Association is planning a fall concert. Expected costs (renting a hall, hiring a band, etc.) are $30,000. Assuming 3,000 people attend the concert, determine the breakeven price per ticket. How much will the association lose if this price is charged and only 2,700 tickets are sold?

c. City Hospital has a contract with the city to provide indigent health care on an outpatient basis for $25 per visit. The patient will pay $5 of this amount, with the city paying the balance ($20).

Determine the amount the city will pay if the hospital has 10,000 patient visits.

d. A civic organization is engaged in a fund-raising program. On Civic Sunday, it will sell newspapers at $1.25 each. The organization will pay $0.75 for each newspaper. Costs of the necessary permits, signs, and so forth are $500. Determine the amount the organization will raise if it sells 5,000 newspapers.

e. Christmas for the Needy is a civic organization that provides Christmas presents to disadvantaged children. The annual costs of this activity are $5,000, plus $10 per present. Determine the number of presents the organization can provide with $20,000. (p. 83)