Find the variable and fixed cost of this excel sheet for the dalton case and give a summary analysis or suggestions.

Case will be added under the excel sheet case you need it.

B Fixed Variable Cost Cost 528,198 162,304 690,502 567,411 11,747 1,269,660 134,328 1 2. 3 Revenues 4. Food and Beverage 5 Catering 6 Concessions 7 8 Room Rental and Fees 9 Other 10 Total Revenue 11 Cost of Goods Sold (COGS) 12 13 Operating Expenses for 2017 14 Salaries and Wages 15 Full-Time Salaries (Fixed) 16 Part-Time Wages (Variable) 17 Total Salaries and Wages 18 Benefits (related to salaries and wages) 19 Insurance - Workers' Compensation 20 Payroll Taxes 21 Total Payroll Expenses 22 Building Operation 23 Building Supplies 24 Data Processing 25 Equipment Maintenance (Elevator, HVAC, Other) 26 Insurance-excluding Workers' Compensation 27 Electricity 28 Gas 29 Water and Waste 30 Depreciation 31 Miscellaneous Event Costs 32 Equipment Rental (for Events) 33 Linens (for Events) 34 Other General and Administrative Expenses 35 Total Expenses, excluding COGS 36 Operating Loss 37 746,923 254,438 1,001,361 121,676 5,850 67,105 1,195,992 40,105 18,102 24,035 34,792 129,661 18,777 16,145 561,805 4,371 13,978 99,236 2,156,999 (1,021,667) 38 INTRODUCTION Brett Huske, director of tourism for the Dalton, Ga., Convention and Visitor's Bureau, sits at his desk poring over several documents. Recalling his more than 30 years of experience in the tourism-related industry, he is aware of the rewards and challenges of holding positions in top resorts and event cities like Aspen, Colo.; Hawaii; Key West, Fla.; and Austin, Texas. Brett came to Dalton in 2010 and was promoted to his current position in 2013. He found managing the Dalton Convention Center to be especially demanding, given the changes experienced by the center's major customer, the area's floor-covering industry. The Dalton Convention Center is visibly perched on a hillside overlooking downtown Dalton, the seat of Whitfield County. Although Brett is not a Dalton native, he is aware that much of the population is made up of long-term residents who are familiar with the area's background and that the center was built to support the needs of the floor-covering manufacturers and their supply chain partners (see www.visitdaltonga.com/convention-center). The center was built in 1991 with the expectation that it would be heavily used by the carpet industry to serve the industry's customers and vendors, as well as provide a facility for the local carpet industry and company training events. Since a convention center has the potential to be a valuable asset for any area, Dalton and Whitfield County decided a joint venture to build the center would be a sound investment and that it could help support Dalton, Whitfield County, and surrounding communities. City and county officials expected the center to generate business activity in the area and repay the investment through increased tax revenues. Yet, given the joint city and county funding model, one of the challenges was finding a way to communicate the center's strengths so that the local governments and residents could see it as a good investment, rather than "the white elephant on the hill." As the carpet industry consolidated and matured, the center's purpose changed. With fewer manufacturers, there was no longer a need for large industry trade shows. The stalling economy during the 2007-2009 recession severely hurt the carpet industry, and, as a result, the center's usage has not met expectations. While it is operating full-time, not all of its capacity is used. Although the center hosts company-specific events, academic and political forums, annual meetings of the local electric utility, weekend cat shows, bird shows, Civil War shows, and even weddings and other private events, the community believes it is poorly utilized and a drain on the taxpayers and businesses who funded it. Private events are not published on the center's website, and the community does not know about many of them. This makes Brett wonder, "What is to be the Dalton Convention Center's future?" OWNERSHIP STRUCTURE Dalton and Whitfield County each contribute 50% annually to cover the operating income shortfall. In addition, they each contribute 50% of all capital improvements or debt service, if any. The center was formed by an act of the Georgia legislature and is tax-exempt. Accordingly, the legislature must approve any modifications to the agreement. TAX REVENUES Georgia law allows Dalton and Whitfield County to increase the hotel and motel tax from 6% to 7%, with 50% of the amount in excess of to be used for tourism, conventions, and trade shows. The city and county determine the amount used for the center. Eighteen hotels are located within Dalton, and two hotels are elsewhere in Whitfield County. The hotel and motel tax revenues expected for 2017 by Dalton and Whitfield County are $1.3 million and $244,246, respectively. Some county leaders see the tax revenue allocation as a sore spot because the cost of the convention center must be shared equally. CONVENTION CENTERS A convention center is built to provide a facility that can serve a variety of uses for large groups, most notably to bring together businesses of a single industry or related industries for product exhibitions and other promotional activities. Many cities have convention centers. More than 500 operate in the United States, and several are in Georgia, most notably the World Conference Center in Atlanta. Typically, the centers have one or more large auditoriums, with several smaller rooms designed as concert halls and meeting rooms. Total square footage limits the size and type of events that can be accommodated. Several U.S. convention centers offer more than 2 million square feet and can attract exceptionally large events and international participants. Convention centers provide benefits to communities, but their primary purpose is usually economic development. Attracting people to conferences and other events can bring new funding into a community. Conference attendees often spend money on hotels, restaurants, and tourism, which stimulates the local economy. The economic benefits include the financial effects on a community that an event or a facility may provide. The financial includ an increase in sales throughout the community that are not directly from the facility, improved property values, higher employment, and increased wages. When multipliers are applied to estimate the economic effects on a community, care must be taken to omit mere shifts in employment and resources from one activity to another because no incremental benefit to the community is derived from people simply changing jobs. For example, an increase in hotel occupancy indicates new money entering a community, whereas catering a local event merely shifts the income from the event from one local facility to another. DALTON CONVENTION CENTER The center is home to the Georgia Athletic High School Coaches' Hall of Fame, has an arena with a maximum seating capacity of 2,100, is home to the Georgia Rampage of the Xtreme Indoor Football League, and is the home court for the Dalton State College Roadrunners basketball team. The center also contains numerous rooms and banquet halls. The high-demand months (called the "blue months") are March, April, November, and December. The J months" (January, June, and July) are the low-demand months. Demand in the other five months falls in the middle. Market segment revenue by percentage is summarized in Table 1 The center does not have standard prices. Instead, Brett or the marketing director negotiates the charges for all customers and events, taking into account space requirements, demand at that time of year, and an event's direct costs. At a minimum, an event's sponsor will be charged more than an event's variable and direct costs; however, the center cannot always charge enough to cover fixed facility costs and overhead in the low-demand months. Brett has explained, "We are better off financially if we can cover some of the fixed costs as long as we cover all of the variable costs. In addition, the community benefits from the economic impact of attendees staying in the hotels and eating in area restaurants-business these proprietors would not have if the convention center did not attract people to the community with our events." Measuring economic impact is more subjective than measuring operating revenue and cost. Yet convention and trade centers and special events that bring visitors to an area are widely considered to have an economic benefit on a community. The Dalton Chamber of Commerce published an article about the center's economic impact in 2014. At the beginning of 2017, Brett commissioned an economic impact study to convince the city and county of the facility's value. The study indicated the community received an economic benefit from operating the center of approximately $5 million for 2017. The estimate was based on the following formula: number of event nights at $140.50 per night, multiplied by the total number of event guests staying overnight at hotels in the area, plus the number of event nights at $55 per night, multiplied by total event guests that were not staying overnight. FINANCIAL SUMMARY OF CURRENT OPERATIONS The primary sources of revenue are related to the center's events. Total revenue for the 2017 calendar year was $1,269,660, according to the center's budget tracking reports. Of that total, $690,501, or 54.4%, came from the sale of food and beverages. Most of the food and beverage revenue came from catering (76.5%), and the rest (23.5%) was from concessions. The remaining 45.1% of the center's revenue total came from room rental and related fees associated with events. A breakdown of the revenue and expenses is presented in Table 2. Salaries are noted as fixed costs, while wages are variable. Other payroll-related costs should be classified as fixed or variable based on the ratio of salaries to wages. Event costs are generally variable, and other costs could be fixed or variable. According to the Dalton financial manager, even if the convention center operations were discontinued, the city and county would continue to spend approximately $240,000 per year to maintain the building until it could be sold or repurposed. These expenses are classified as unavoidable costs. The full financial statements for years 2016 and 2017 are presented in Table 3. BRETT'S PREDICAMENT Brett believes he needs to take definitive actions to better address how the city and county perceive the center. After considering all the forces in play, he begins listing his options, realizing that some would be mutually exclusive and have to be eliminated. Further complicating the decision process, he knows that community leaders want actions with quick results. Brett needs your help to develop a recommendation to present to the city and county. 2020 IMA Table 3. Dalton Convention Center Financial Statements Panel B: Income Statements Statements of Revenues, Expenses, and Changes in Fund Net Position For the Years Ended December 31, 2017 and December 31, 2016 Statements of Revenues, Expenses, and Changes in Fund Net Position For the Years Ended December 31, 2017 and December 31, 2016 Operating Revenues 2017 2016 Event and Rental Revenue $1,269,660 $1,442,274 Operating Expenses Event Costs 591,460 664,426 Facility and Administration 1,138,062 1,186,340 Depreciation 561,805 515,165 Total Operating Expenses 2,291,327 2,365,931 Operating Income (Loss) (1,021,667) 923,657) Nonoperating Revenues (Expenses) Interest Income 1,533 573 Gain (Loss) on Disposal of Assets 6,685 8,855 Intergovernmental Revenue - Local 1,238.381 1,223,013 Total Nonoperating Revenues (Expenses) 1,246,599 1,232,441 Change in Net Position 224,932 308,784 Total Net Position - Beginning 10.165,941 9,857,157 Total Net Position - Ending $10,390,873 $10,165,941 B Fixed Variable Cost Cost 528,198 162,304 690,502 567,411 11,747 1,269,660 134,328 1 2. 3 Revenues 4. Food and Beverage 5 Catering 6 Concessions 7 8 Room Rental and Fees 9 Other 10 Total Revenue 11 Cost of Goods Sold (COGS) 12 13 Operating Expenses for 2017 14 Salaries and Wages 15 Full-Time Salaries (Fixed) 16 Part-Time Wages (Variable) 17 Total Salaries and Wages 18 Benefits (related to salaries and wages) 19 Insurance - Workers' Compensation 20 Payroll Taxes 21 Total Payroll Expenses 22 Building Operation 23 Building Supplies 24 Data Processing 25 Equipment Maintenance (Elevator, HVAC, Other) 26 Insurance-excluding Workers' Compensation 27 Electricity 28 Gas 29 Water and Waste 30 Depreciation 31 Miscellaneous Event Costs 32 Equipment Rental (for Events) 33 Linens (for Events) 34 Other General and Administrative Expenses 35 Total Expenses, excluding COGS 36 Operating Loss 37 746,923 254,438 1,001,361 121,676 5,850 67,105 1,195,992 40,105 18,102 24,035 34,792 129,661 18,777 16,145 561,805 4,371 13,978 99,236 2,156,999 (1,021,667) 38 INTRODUCTION Brett Huske, director of tourism for the Dalton, Ga., Convention and Visitor's Bureau, sits at his desk poring over several documents. Recalling his more than 30 years of experience in the tourism-related industry, he is aware of the rewards and challenges of holding positions in top resorts and event cities like Aspen, Colo.; Hawaii; Key West, Fla.; and Austin, Texas. Brett came to Dalton in 2010 and was promoted to his current position in 2013. He found managing the Dalton Convention Center to be especially demanding, given the changes experienced by the center's major customer, the area's floor-covering industry. The Dalton Convention Center is visibly perched on a hillside overlooking downtown Dalton, the seat of Whitfield County. Although Brett is not a Dalton native, he is aware that much of the population is made up of long-term residents who are familiar with the area's background and that the center was built to support the needs of the floor-covering manufacturers and their supply chain partners (see www.visitdaltonga.com/convention-center). The center was built in 1991 with the expectation that it would be heavily used by the carpet industry to serve the industry's customers and vendors, as well as provide a facility for the local carpet industry and company training events. Since a convention center has the potential to be a valuable asset for any area, Dalton and Whitfield County decided a joint venture to build the center would be a sound investment and that it could help support Dalton, Whitfield County, and surrounding communities. City and county officials expected the center to generate business activity in the area and repay the investment through increased tax revenues. Yet, given the joint city and county funding model, one of the challenges was finding a way to communicate the center's strengths so that the local governments and residents could see it as a good investment, rather than "the white elephant on the hill." As the carpet industry consolidated and matured, the center's purpose changed. With fewer manufacturers, there was no longer a need for large industry trade shows. The stalling economy during the 2007-2009 recession severely hurt the carpet industry, and, as a result, the center's usage has not met expectations. While it is operating full-time, not all of its capacity is used. Although the center hosts company-specific events, academic and political forums, annual meetings of the local electric utility, weekend cat shows, bird shows, Civil War shows, and even weddings and other private events, the community believes it is poorly utilized and a drain on the taxpayers and businesses who funded it. Private events are not published on the center's website, and the community does not know about many of them. This makes Brett wonder, "What is to be the Dalton Convention Center's future?" OWNERSHIP STRUCTURE Dalton and Whitfield County each contribute 50% annually to cover the operating income shortfall. In addition, they each contribute 50% of all capital improvements or debt service, if any. The center was formed by an act of the Georgia legislature and is tax-exempt. Accordingly, the legislature must approve any modifications to the agreement. TAX REVENUES Georgia law allows Dalton and Whitfield County to increase the hotel and motel tax from 6% to 7%, with 50% of the amount in excess of to be used for tourism, conventions, and trade shows. The city and county determine the amount used for the center. Eighteen hotels are located within Dalton, and two hotels are elsewhere in Whitfield County. The hotel and motel tax revenues expected for 2017 by Dalton and Whitfield County are $1.3 million and $244,246, respectively. Some county leaders see the tax revenue allocation as a sore spot because the cost of the convention center must be shared equally. CONVENTION CENTERS A convention center is built to provide a facility that can serve a variety of uses for large groups, most notably to bring together businesses of a single industry or related industries for product exhibitions and other promotional activities. Many cities have convention centers. More than 500 operate in the United States, and several are in Georgia, most notably the World Conference Center in Atlanta. Typically, the centers have one or more large auditoriums, with several smaller rooms designed as concert halls and meeting rooms. Total square footage limits the size and type of events that can be accommodated. Several U.S. convention centers offer more than 2 million square feet and can attract exceptionally large events and international participants. Convention centers provide benefits to communities, but their primary purpose is usually economic development. Attracting people to conferences and other events can bring new funding into a community. Conference attendees often spend money on hotels, restaurants, and tourism, which stimulates the local economy. The economic benefits include the financial effects on a community that an event or a facility may provide. The financial includ an increase in sales throughout the community that are not directly from the facility, improved property values, higher employment, and increased wages. When multipliers are applied to estimate the economic effects on a community, care must be taken to omit mere shifts in employment and resources from one activity to another because no incremental benefit to the community is derived from people simply changing jobs. For example, an increase in hotel occupancy indicates new money entering a community, whereas catering a local event merely shifts the income from the event from one local facility to another. DALTON CONVENTION CENTER The center is home to the Georgia Athletic High School Coaches' Hall of Fame, has an arena with a maximum seating capacity of 2,100, is home to the Georgia Rampage of the Xtreme Indoor Football League, and is the home court for the Dalton State College Roadrunners basketball team. The center also contains numerous rooms and banquet halls. The high-demand months (called the "blue months") are March, April, November, and December. The J months" (January, June, and July) are the low-demand months. Demand in the other five months falls in the middle. Market segment revenue by percentage is summarized in Table 1 The center does not have standard prices. Instead, Brett or the marketing director negotiates the charges for all customers and events, taking into account space requirements, demand at that time of year, and an event's direct costs. At a minimum, an event's sponsor will be charged more than an event's variable and direct costs; however, the center cannot always charge enough to cover fixed facility costs and overhead in the low-demand months. Brett has explained, "We are better off financially if we can cover some of the fixed costs as long as we cover all of the variable costs. In addition, the community benefits from the economic impact of attendees staying in the hotels and eating in area restaurants-business these proprietors would not have if the convention center did not attract people to the community with our events." Measuring economic impact is more subjective than measuring operating revenue and cost. Yet convention and trade centers and special events that bring visitors to an area are widely considered to have an economic benefit on a community. The Dalton Chamber of Commerce published an article about the center's economic impact in 2014. At the beginning of 2017, Brett commissioned an economic impact study to convince the city and county of the facility's value. The study indicated the community received an economic benefit from operating the center of approximately $5 million for 2017. The estimate was based on the following formula: number of event nights at $140.50 per night, multiplied by the total number of event guests staying overnight at hotels in the area, plus the number of event nights at $55 per night, multiplied by total event guests that were not staying overnight. FINANCIAL SUMMARY OF CURRENT OPERATIONS The primary sources of revenue are related to the center's events. Total revenue for the 2017 calendar year was $1,269,660, according to the center's budget tracking reports. Of that total, $690,501, or 54.4%, came from the sale of food and beverages. Most of the food and beverage revenue came from catering (76.5%), and the rest (23.5%) was from concessions. The remaining 45.1% of the center's revenue total came from room rental and related fees associated with events. A breakdown of the revenue and expenses is presented in Table 2. Salaries are noted as fixed costs, while wages are variable. Other payroll-related costs should be classified as fixed or variable based on the ratio of salaries to wages. Event costs are generally variable, and other costs could be fixed or variable. According to the Dalton financial manager, even if the convention center operations were discontinued, the city and county would continue to spend approximately $240,000 per year to maintain the building until it could be sold or repurposed. These expenses are classified as unavoidable costs. The full financial statements for years 2016 and 2017 are presented in Table 3. BRETT'S PREDICAMENT Brett believes he needs to take definitive actions to better address how the city and county perceive the center. After considering all the forces in play, he begins listing his options, realizing that some would be mutually exclusive and have to be eliminated. Further complicating the decision process, he knows that community leaders want actions with quick results. Brett needs your help to develop a recommendation to present to the city and county. 2020 IMA Table 3. Dalton Convention Center Financial Statements Panel B: Income Statements Statements of Revenues, Expenses, and Changes in Fund Net Position For the Years Ended December 31, 2017 and December 31, 2016 Statements of Revenues, Expenses, and Changes in Fund Net Position For the Years Ended December 31, 2017 and December 31, 2016 Operating Revenues 2017 2016 Event and Rental Revenue $1,269,660 $1,442,274 Operating Expenses Event Costs 591,460 664,426 Facility and Administration 1,138,062 1,186,340 Depreciation 561,805 515,165 Total Operating Expenses 2,291,327 2,365,931 Operating Income (Loss) (1,021,667) 923,657) Nonoperating Revenues (Expenses) Interest Income 1,533 573 Gain (Loss) on Disposal of Assets 6,685 8,855 Intergovernmental Revenue - Local 1,238.381 1,223,013 Total Nonoperating Revenues (Expenses) 1,246,599 1,232,441 Change in Net Position 224,932 308,784 Total Net Position - Beginning 10.165,941 9,857,157 Total Net Position - Ending $10,390,873 $10,165,941