Calculate the re-negotiate the part-time trainers cost, Cost Accounting

a.    If you could pick a single source of cash for your business, what would it be? Why?

b.    How can a business earn large profits but have a small balance in Retained Earnings?

c.    How can a business lose money for many years and still have plenty cash?

d.    Give two reasons why a business can be profitable for many years and still have a cash shortage?

e.    Suppose your business has $80,000 worth of liabilities that must be paid within the next three months.  Your liquid (can be turned into cash quickly) assets total only $60,000, your sales and collections from customers are slow.  Identify two ways to finance the remaining $20,000 you will need, so you can pay all of the liabilities when they are due.

Janice Colangelo heads the Training Centre of the large HR Consulting firm EMT Consulting.  The firm has three major departments: Recruitment, Training and Career Services.

The Training Centre provides management training for employees of various businesses. Recruitment provides recruitment services and Career Services assists personnel with resumes and offers advice on career planning.

The Training Centre employs 2 administrative assistants, 1 training officer and Janice, the manager on a permanent basis. Part-time trainers are hired on an as-needed basis. Part-time trainers are paid $1500 per workshop.

During 2008 the Training Centre conduction 200 workshops with 20 individuals in each.  The charge per individual was $300. This is the maximum number of workshops that can be held in a year.

Following are the results for 2008.

Training Revenue (200 x 20 x $300)

$1,200,000

Less Expenses:

 

            Trainer costs (200 x 2 x $1500)

600,000

            Manager's Salary

120,000

            Training officer

90,000

            Administrative staff

80,000

            Utilities/phone costs

 20,000

            Manuals for participants

120,000

            Advertising costs

125,000

            Postage & other miscellaneous costs

9,450

            Total expenses

$ 1,164,450

 

 

Income from operations

$35,550

Common Allocated costs (10% of revenue)

120,000

Net Income or (loss)

$(84,450)

Required:

1.    a.   Classify each of the costs as variable or fixed.

b.   What would be the effect on the profit of the whole company, if the Training Centre was closed at the beginning of the new year?

Note :If the Training Centre is closed, one administrative staff will be retained to work in the Career Services department.

2.    Given the allocated costs at 10% of revenue, calculate the number of workshops that must be offered to break-even.

3.    Re-calculate #2 above, assuming Janice can re-negotiate the part-time trainers' cost to $1000 per workshop.

4.    With the increase in globalization and companies outsourcing many jobs, Janice thinks that, in addition to management training, the Training Centre should offer "second career" training.  Janice feels that this will add 100 more workshops with an average enrollment of 15 participants at a cost of $200 each.  The rate per participant is based on the fact that a non-profit organization has offered its facilities, free of charge, to run the workshops.

What effect will this have on the Training Centre profit?

Note: The trainers will be paid $1000 per workshop.  The only other additional cost will be manuals at $15 each.

Posted Date: 4/1/2013 6:04:22 AM | Location : United States







Related Discussions:- Calculate the re-negotiate the part-time trainers cost, Assignment Help, Ask Question on Calculate the re-negotiate the part-time trainers cost, Get Answer, Expert's Help, Calculate the re-negotiate the part-time trainers cost Discussions

Write discussion on Calculate the re-negotiate the part-time trainers cost
Your posts are moderated
Related Questions
Consider as Illustration. Profit and loss account of TIL demonstrates, that, operations have given gross addition of Rs. 360 million to funds throughout the period. These funds sho

importance of marginal costing &standing costing

Find the following values for a single cash flow: a. The future value of $500 invested at 8 percent for 1  year b. The future value of $500 invested at 8 percent for 5 years

ABC bond is a 20-year bond with face value $1000. The coupon payment is $25 per 6 months. The semi-annual yield is 4%. Use the PV function in Excel (or equivalent) to Önd the price

Do I use the contribution per unit and the total sales for the department in order to calculate the p/v ratio for a department

cost accounting is said to three different phases ?? name them.

OBJECTIVES OF COST ACCOUNTING : 1-DETERMINING SELLING PRICE 2-CONTROLING COST 3- PROVIDING INFORMATION FOR DESING MAKING 4-ASCERTAINING COSTING PROFIT 5-Facilitating preparation of

Prime Essentials Limited is a small private corporation. The owner plans to approach the bank for an additional loan or a line of credit to facilitate expansion. The company bookke

what is the meaning of classification of cost in relation to variability?

Standard Cost It is especially serious that you establish a link between standard budgets and costs. At this point, you require putting in your mind to standard costs one the