1. Compute the projected revenue level for July using a four-month moving average and the following sales data

January $180,000

February $220,000

March $230,000

April $200,000

May $250,000

June $280,000

1. A motel has an occupancy rate of 75%, with 260 rooms available per day. At an ARR of $68; forecast room revenue for the month using 30 days.

1. Compute the variable cost per unit and the fixed cost per month for the semi-variable expense based on the information provided using the high-low method

Month Volume Labor Cost

1 1500 $280

2 1280 $220

3 2500 $380

4 1750 $310

5 1250 $230

Use the weighted average to compute the average room rate from the following information:

Rooms Rate

Single 45 $65.00

Double 55 $85.00

Suite 15 $125.00

1. Use the following information

Sales = $537,000

Average Guest Check = $18.75

Food Cost Percent = 35.0%

IBIT = $150,000

Calculate Break-even point

1. Complete the in/off season analysis for the following information

Last Year In-Season Off-Season If Closed

(12 months) (9 months) (3 months) off-season

Sales $400,000 $300,000

VC $300,000

CM $100,000

FC $ 60,000

IBIT $ 40,000

1. Use the CVP analysis method to calculate sales revenue required to achieve an IBIT of $75,000 with the following forecast data: Sales Forecast = $373,000

Variable costs = $167,000

Fixed costs = $103,000

Determine sales required to achieve an IBIT objective of $75,000

1. Calculate the payback period for the following project. Use straight-line depreciation.

Purchase of equipment $100,000

Annual Savings $30,000

Depreciable life of asset 5 years

Salvage value 0

Use the following information to determine the cause of sales variances: (10 points)

Budget Actual Variance

Room Sales 463,500 516,750

Information from managers budget working papers

Rooms: 4,500

Average room rate: $103.00

Current months statistics from the accounting department

Rooms: 5,300

Average room rate: $97.50

1. Provide a series of flexible budgets giving Sales, Variable Costs, Fixed Costs and Net Income for the year for estimated sales levels of 1000, 1500, and 2000 units; using fixed costs of $3,000 and variable costs per unit of $3.00 assuming a sales price per unit of $5.25

Unit Sales 1000 1500 2000

Sales Dollars

Variable Costs

Fixed Cost

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IBIT