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BROOKLYN MENs SHELTER (BMS) The Brooklyn Mens Shelter (BMS) provides weekly housing and meals to the residents in its shelter. The shelter has 280 beds

BROOKLYN MENs SHELTER (BMS)

The Brooklyn Mens Shelter (BMS) provides weekly housing and meals to the residents in its shelter. The shelter has 280 beds and always has 100% occupancy, FOR THE ENTIRE YEAR, 360 DAYS OR 12 MONTHS. There is no shortage of demand for BMSs services among men between the ages of 40-60. Each man helped by BMS receives two hot meals per day, 7 days per week, for a total of 14 meals every week. BMS receives, per week, reimbursement from the city of New York, in the amount $500 per resident.

To service the contract, BMS has a central kitchen that has the capacity to produce a maximum of 600 meals per day. It costs BMS an average of $15,000, per week to operate the kitchen and other central facilities regardless of the number of meals that BMS serves. The $15,000 covers all of BMSs fixed costs (e.g., rent, equipment costs, and its personnel including administrative staff) as well as its fixed seasonal service contract costs (utilities, snow removal, etc.). To ensure longevity, BMS has built into its reimbursement a 20% profit margin.

1. WHAT IS BMS TOTAL ANNUAL REVENUES?

2. WHAT IS BMS TOTAL ANNUAL EXPENSES.

3. How much can BMS afford to spend per person, per week for food to supply the program, AND still deposit its profits? Food is BMSs only variable expense. Operating at a maximum capacity, the BMS kitchen has the capacity to produce meals for people (600 meals per day/2 meals per day for each person). The city of New York is paying weekly the $500 per person.

4. PREPARE AN ANNUAL BUDGET FOR BMS SHOWING EITHER SURPLUS OR DEFICIT.

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