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Question 2
Analyze Adventure Park's staffing budget Adventure Park is a large theme park. Staffing for the theme park involves many different labor classifications, one of which is the parking lot staff. The parking lot staff collects parking fees, provides directions, and operates trams. The staff size is a function of the number of daily vehicles. Adventure Park has determined from historical experience that a staff member is needed for every 200 vehicles. Adventure Park estimates staff for both school days and nonschool days. Nonschool days are higher attendance days than school days. The number of expected vehicles for each day is as follows: Parking fees are $10 per vehicle. Each parking lot employee is paid $110 per day. a. Determine the annual parking lot staff budget for school days, nonschool days, and total. b. Determine the annual parking revenue for school days, nonschool days, and total. c. If depreciation expense and other expenses for running the parking lot were estimated to be $2 million per year, determine the parking lot's budgeted profit. Budgeted parking lot profit =$ At the beginning of the school year, Craig Kovar decided to prepare a cash budget for the months of September, October, November, and December. The budget must plan for enough cash on December 31 to pay the spring semester tuition, which is the same as the fall tuition. The following information relates to the budget: This information has been collected in the Microsoft Excel Online file. Open the spreadsheet, perform the required analysis, and input your answers in the questions below. a. Prepare a cash budget for September, October, November, and December. Enter all amounts as positive values except cash decrease which should be indicated with a minus sign. Craig Kovar Cash Budget b. Are the four monthly budgets that are presented prepared as static budgets or flexible budgets? c. What are the budget implications for Craig Kovar? Craig can see that his present plan sufficient cash. If Craig did not budget but went ahead with the original plan, he would be $ at the end of December, with no time left to adjust
