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QUESTION 6 Zurich American School is an international private elementary school. In addition to regular classes, after-school care is provided between 3 pm and
QUESTION 6 Zurich American School is an international private elementary school. In addition to regular classes, after-school care is provided between 3 pm and 6 pm at SFR 12 per child per hour. Financial results for the after-school care for a representative month are Revenue, 600 hours @ SFR 12 per hour Less: Teacher salaries Supplies Depreciation Sanitary engineering Other fixed costs Operating income (loss) SFR 7,200 SFR 5,200 800 1,300 100 200 7,600 SFR (400) The director of Zurich American School is considering discontinuing the after-school care services because it is not fair to the other students to subsidize the after-school care program. He thinks that eliminating the program will free up SFR 400 a month to support regular classes. Required: 1. Compute the financial impact on Zurich American School from discontinuing the after-school care program 2. List three qualitative factors that would influence your decision.
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