DAY CARE COMPUTER EXERCISE, PART 2 It is now September of 2000, and the day care center has been successfully operating for 8 months. The demand for day care has been as strong as anticipated, with enrollment growing by 5 percent per month and significant unmet demand. While most of the parameters used to construct the 2000 budget were correct, there are a few adjustments which must be made to personnel scheduling and other cost factors for 2001. Budget Adjustments 1) Tiny Tots, Inc. has started providing paid vacation/personal days to their employees. Day care workers get 2 weeks of paid time, based on 40 hours per week. 2) In 2000, the budget did not include coverage for a lunch hour for each employee. As a result, employees had to work during lunch; that violates union rules. This year, the staff will be provided a one-hour paid lunch (they still get paid for 8 hours/day), and the director is considering using part-time work study college students to cover the lunch hours. The college students have to work at least 15 hours per week and will get paid at the going rate for day care workers. Lunch hours are from 11 to 2, and employees can be assigned to any lunch hour. (The objective is to schedule lunch hours for the staff to minimize staffing requirements.) 3) Day care workers can work up to 9 hours per day, 40 hours per week, without being paid overtime (time and a half). The personnel costs will rise to: Wage: $7.0 per hour Social Security: 7.5% Unemployment: 8% Pension: 6.5% Health insurance: $100 4) In addition, the center has had to add liability insurance of $1,000 per month and fire and theft insurance of $500 per month that will cover any services provided by the center. 5) All other costs are expected to increase by an inflation rate of 5 percent during 2001. Additional Services: Besides the additional staffing requirements, Tiny Tots is thinking of adding additional services to the day care center: 4