Questions 1 to 3: Below are the financials for the first half of the year for the rooms division at Big Sky Lodge; the static budget variance has been provided for you. You will use the principles of flexible budgeting to evaluate the expenses and profitability of the rooms division. This analysis will be completed in three parts: first, you will evaluate labor for the rooms division; second, you will evaluate other expenses for the rooms division; and last, you will evaluate total expenses and departmental income for the rooms division. ROOMS DEPARTMENT Static Flexible Actual Budget Variance Budget Variance Revenues Cost Driver Description Total Rooms Revenue $716,295 Total Rooms Sold 3459 $697,320 $18,975 3312 147 $716,295 50 TRR 3459 0 TRS Total Rooms Revenue Total Rooms Sold PreTax Labor Room Payroll Before PT&B Question 1 (4 pts) Rooms Labor Room Division Management $31,181 $31,206 -$25 Room Clerks/Auditors $38,165 $37,648 $517 Housekeeping Staff $40,710 $42,822 -$2.112 Room Payroll Before PT&B $110,056 $111,678 -$1,820 P/R Tax & Benefit Alloc $16.451 $16,751 -$300 Contract Housekeeping Staff $4,270 SO $4,270 Total Rooms Labor $130,777 $128,427 $2,350 Calculation Variable Not Budgeted Calculation Cost Type Fixed Cost Driver Variable Cost Fixed Cost $31,206 Fixed $37,848 Mixed TRS $8.67 $14,118 Pre Tax Labor 15.00% Question 2 (4 pts) Rooms Other Expenses Cleaning & Laundry Supplies $4.180 $4,008 $172 Variable TRS $1.21 Commissions $3,459 $3,487 -$28 Variable TRR 0.50% Guest Supplies $5.385 $5,299 $88 Variable TRS $1.60 Guest Transportation $952 $997 -$45 Mixed TRS $0.15 $500 Linens $3.683 $3,577 $106 Variable TRS $1.08 Satellite TV $7,774 $7,682 $92 Fixed $7,682 Uniforms $333 $331 $2 Variable TRS $0.10 Total Rooms Other Expense $25,768 $25,380 $388 Calculation 68 69 Question 3 (2 pts) 70 71 Total Rooms Expense $158,543 $153,807 $2,738 72 -73 Departmental Income $559,752 $543,513 $16,239 78 79 Below is the calculation of the hotel's guest score percentile from January through June. 80 81 Hotel Class Median Overall Guest Satisfaction 72.0% 82 Standard Distribution of Overall Guest Satisfaction 8.5% 83 84 Hotel's Overall Guest Satisfaction Percentile 80.5% 84.1 Calculation Calculation 85 86 Question 4: Populate the table below by first calculating each of the measurement metrics. The first metric is the percent of budgeted revenue earned (actual total rooms revenue/static budget total rooms revenue). This figure is measured as a percentage. Having 100% would mean they precisely met their budgeted revenue. The second metric is the flexible budget variance for total rooms expense. The third metric was provided you above; it is the hotel's guest score percentile for overall guest satisfaction. Once you have determined the measurement for each metric, you need to determine if each required threshold was met. If all the thresholds were met, you will then select the appropriate payout percentage. Last you will calculate the incentive payout for each metric along with the total payout. (5 pts) 87 88 89 Total Revenue 90 Total Rooms Department Expenses 91 Overall Guest Satisfaction 92 100 101 102 Measurement Threshold Met Payout % Total -