Teachers of two-day program:	$440 per month
Teachers of three-day program:	$644 per month
Teachers of four-day program:	$860 per month
Teachers of five-day program:	$1,080 per month
Preschool director's salary:	$1,550 per month

Greatland

Preschool has

9

two-day program teachers,

6

three-day program teachers,

4

four-day program teachers, and

4

five-day program teachers. The preschool also has a director.

In addition to the salary expense, the preschool must pay federal payroll taxes (FICA taxes) in the amount of

7.65%

of salary expense. The preschool leases its facilities from a local church, paying

$4,012

every month it operates. Fixed operating expenses (telephone, internet access, bookkeeping services, and so forth) amount to

$860

per month over the

nine-month

school year. Variable monthly expenses (over the

nine-month

school year) for art supplies and other miscellaneous supplies are

$13

per child. Revenue for the entire

nine-month

school year from tuition, registration fees, and the lunch program is projected to be

$241,200.

Requirement 1. Prepare

Greatland

Preschool's monthly operating budget. Round all amounts to the nearest dollar. (Round amounts to the nearest dollar.)

Greatland Preschool
Budgeted Monthly Operating Expenses
Teachers' salary:
2-day program
3-day program
4-day program
5-day program
Director salary
Total salary expense
Payroll tax expense
Lease expense
Fixed operating expenses
Variable operating expenses
Total monthly operating expenses

Part 2

Requirement 2. Using your answer from Requirement 1, create

Greatland

Preschool's budgeted income statement for the entire

nine-month

school year. You may group all operating expenses together.

Greatland Preschool
Budgeted Income Statement
For the Year Ended
Tuition, registration fees, and lunch bunch revenue
Operating expenses
Operating income

Part 3

Requirement 3.

Greatland

Preschool is a not-for-profit preschool. What might the preschool do with its projected income for the year? From the budgeted income statement,

Greatland

Preschool learns that

it does not have

it has

it needs

projected operating income for the year. Since the preschool is a not-for-profit preschool,

it is

it is not

it should be

in business to generate income for its owners. The preschool may be able to

further its organizational goals with the projected income

pay bonuses to it's executives with the projected income

pay dividends to it's stockholders' with the projected income

.

Part 4

It may decide to use the income for any of the following purposes. (If an input field is not used in the table leave the input field empty; do not select a label.)

Offer scholarships to families who have difficulty paying tuition