Alexa informs you that due to COVD-19 only 15 people have registered for the event in May 2020. She shows you the budget below. The budget is based on the 5,000 fliers mailed and registration response rates of 2%, 3%, and 4%. The marketing consultants expect at least a 3% registration rate from the direct mail campaign but only 0.3% have responded (15 people). Response Rate 2% 3% 4% Per Attendee $595 Total $ 59,500 Per Attendee $595 Total $ 89,250 Registration fee Per Attendee $595 Total $ 119,000 income $125 $125 12,500 4,500 4,500 $125 45 18,750 6,750 4,500 45 25,000 9,000 4,500 45 | 3,500 3,500 3,500 Expenses Meals Forummaterials Direct mail advertising Meeting room rental Equipment rental Speaker fees & travel expenses: Mr. Einsteina Total expenses Net income 500 500 500 9,200 34,700 $ 24,800 9,200 43,200 $ 46,050 9,200 51,700 $ 67,300 a Einstein required a $1,000 deposit upon confirmation of the original Forum date. The remaining $3,000 was due upon her arrival at the conference. In the event of cancellation, the $1,000 deposit was non-refundable. Alexa has the following options: Option 1: Hold Forum as planned in May with only 15 attendees Option 2: Cancel the Forum and return Forum fees Option 3: Reschedule Forum for Dec. 8th and 9th Alexa suggests that if the Forum were to reschedule, Solmarex would offer a reduced registration fee of $525 to companies that sent more than one person. Alexa asks you to prepare pro-forma income statements for each of the alternatives you identified options above. She is also curious of the knowing what would be the relevant income/loss from each option (remove unavoidable costs). You promise to also include in your report the pros and cons of each options. You do some research and find out the following; The Speaker Einstein is available to attend Dec 8th and 9th if event is rescheduled but he had already purchased a non-refundable airline ticket for $800. If the Forum were rescheduled, he would incur an additional $100 charge to change the flight. Although Solmarex had made no payments to the hotel where the event was to be held in May, the special events coordinator reminded you of two points in the contract: 1. A cancellation fee of $10,000 would need to be paid if the Forum were canceled at this late date. However, the inn would agree to waive the cancellation fee if the Forum were rescheduled within four months of the original date. 2.Solmarex had guaranteed a minimum of 40 guest rooms. If Forum attendees booked fewer rooms, Solmarex would have to pay an additional $5,000 for the meeting room rental. The marketing firm offered to do two additional mailings for a total of $1,500. They also agreed to expand the mailing list to include several other professional organizations, as well as students at engineering schools in the area. The firm estimated the new mailings would reach 6,500 people and should result in a 2% registration rate. Of that 2%, 10% were expected to qualify for the reduced registration fee