Can you help me determine how to calculate the budget and fore
AutoSave (C off) Project 3 Choice Hotels Workbo File Home Insert Page Layout Formulas Data Review View Help Search & Cut [B Copy Calibri 11 AA 29 Wrap Text General Norm Paste Format Painter BIU~ ~ MAY CE E Merge & Center $ * % 9 68 28 Conditional Format as Calcul Formatting * Table Clipboard Font Alignment Number T61 X V M N P In a February 15, 2019 Press Release. Choice Hotels announced the company's 2018 fourth quarter and full year results. Using the data from this press release, create a 2019 budget and forecast. http:/media.choicehotels.com/2019-02-15-Choice-Hotels-International-Exceeds-Top-End-Of-Full-Year-Guidance-For-EPS-And-Reports-Largest-Domestic-Pipeline-In-Companys-History? printable=] To complete the budget, use the following information: are expected to grow at a rate of 2.5% according to the full-year outlook. Given the expected growth and recent investments, expenses are expected to increase by 1%. ncome takes are expected to be 22% To complete the forecast. use the following information: The low-range forecast is expected to be 2% The mid-range forecast is expected to be 2.5% The high-range forecast is expected to be 3% 17 Budget Forecast Forecast 18 Low Midpoint Forecast 19 Consolidated Statements of Inc. Dec. 31. 2018 Dec. 31. 2 Dec. 31. 2019 Dec. 31. 2019 Dec. 31. 2019 High REVENUES 20 Royalty fees 21 *376,676,000 22 Initial franchise and relicensing fees 26,072,000 23 Procurement services Marketing and reservation system 52,088,000 24 543.677,000 25 Other 42,791,000 26 Total revenues OPERATING EXPENSES: $ 1,041,304,000 28 Selling, general and administrative 170,027,000 Depreciation and amortization Marketing and reservation system 14.330,000 ########## $ 191,396,093.56 $193.798.554.98 $ 15.928.521.64 $ 16.400.000.00 # 16.810,000.00 30 31 Total operating expenses 534.266,000 Impairment of goodwill 718,623,000 ########## $ 601,412,865.73 $ 608.961,981.20 ########## $ 808,939.962.13 |$819.094.020.23 32 [4.289,000) Gain on sale of assets, net 82,000 $ (4.767.440.98) $ [4.828,044.05) # (4.888.647.11) Operating income 91,147.16 92,305.81 $ 93.464.46 34 35 OTHER INCOME AND EXPENSES, NET: 318,474,000 ########## $358.500.000.00 |########## Interest expense 45,908,000 36 Interest income (7,452,000) $ 51,029.069.88 $ 45,800,000.00 # 52,326.419.11 37 Other [gain) loss $ [8.283.275.87) $ (7.600,000.00) $ (8.493.867.63] 38 1.437.000 1,637.907.65 39 Equity in net (income) loss of affiliates | $ Total other income and expenses, net $ 5,323,000 $ 1,597.298.37 $ 46.700.000.00 $ 45,216,000 5,916.784.42 $ 3,900,000.00 $ 6,067 211.14 40 $50,259.876.79 $ 50.898.773.53 $ 51537.670.27 41 Income before income taxes $ 273.258.000 Income taxes ########## $ 307.601.226.47 $ 311,462,329.73 42 56,903,000 43 Net income Basic earnings per share: 216,355,000 $ 63,250,569.91 $ 56,200,000.00 $ 64.858,635.24 # ######### $ 197.100,000.00 $201,000,000.00 44 45 Basic earnings per share (in dollars per = $ 3.83 Diluted earnings per share (in dollars per $ 3.80 4.00 3.44 $ 4.06 4.06 4.13 3.58 46 48 Questions: Target Expectation Expectation Expectation 49 50 51 . Which revenue category is the most important to forecast accurately? Explain your rationale for your selection and how you developed your three estimates thoroughly . 52 53 54 55 56 2. Which expense category is the most important to forecast accurately?' Explain your rationale for your selection and how you developed your three estimates thoroughly . 57 58 59 60 61 3. Explain thoroughly how you developed your budget estimates for all revenue and operating expense accounts. 62 63 64 Instructions Income Statement Balance Sheet Cash Flow Cost and Investing Budget and Forecast +
