1. accounting (20 points) The Miami Art Museum (MAM) is working on the budgets for the 2019 fiscal year (FY), which runs from January 1 through December 31. During the first half of FY19, MAM expects its revenues and expenses to be relatively the same as the 2018 fiscal year; however, during the second half of the 2019 fiscal year MAM plans to open a new gallery focusing on contemporary art. Currently, MAM pays its Executive Director $80,000; its Curatorial and Educational staff a total of $230,000; and its administrative and resource development staff $90,000 each year. The Museum makes fixed rent payments of $12,000 every month, and utilities and other fixed expenses equal to $4,000 a month. When the new gallery opens on July 1, 2019, MAM will have to hire a new Curator, at an annual salary of $50,000. In addition, the new gallery is expected to increase monthly rent payments by $2,500 and monthly utilities and other fixed expenses by $500. MAM expects to receive a number of grants from foundations in FY19. Three foundations have promised grants of $60,000 each in the first half of 2019, and two more foundations have promised grants of $125,000 each when the new gallery opens. Finally, MAM receives numerous individual donations from mail and telephone solicitations; on average these individual supporters provide MAM with $30,000 in unrestricted revenue every quarter.

MAM provides educational materials for each visitor at a cost to MAM of $1.20 per visitor. Although MAM is a free museum, it encourages its visitors to make a donation as they leave the museum. On average, each visitor donates $2. During the first six months of the new fiscal year, MAM expects the average monthly attendance to be 10,000. When the new gallery opens, the Museum forecasts that its average monthly attendance will increase to 13,000.

Create a semi-annual operating budget for the Miami Art Museum's Fiscal Year 2019. (Hint: the operating budget should show the income and costs of the museum for the first six months and also for the last six months of FY19, and show line items for the various categories of expense in the problem).For purposes of your budget, you can also assume that all of your revenue items will be received as projected, etc.