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)


Less Expenses:


            Trainer costs (200 x 2 x $1500)


            Manager's Salary


            Training officer


            Administrative staff


            Utilities/phone costs


            Manuals for participants


            Advertising costs


            Postage & other miscellaneous costs


            Total expenses

$ 1,164,450



Income from operations


Common Allocated costs (10% of revenue)


Net Income or (loss)



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
Interstate Manufacturing produces brass fasteners and incurred the following costs for the year just ended: Materials and supplies used Brass $75,000 Repair parts 16,000

OVERHEAD VARIANCES Unlike labour and direct material, the manufacturing overhead is not completely variable with the level of production.   So, standard costs for factory overh

Assume your grandparents have just given you $20,000 on the condition that you invest the money in the stock market. As you contemplate making your investment choices, what accoun

Tyler's Consulting Company has purchased a new $15,000 copier. This overhead cost will be shared by the purchasing, accounting, and information technology departments since those a

Portions of the financial statements for Hawkeye Company are provided below. HAWKEYE COMPANY Income Statement For the Year Ended December 31, 2013 Sales $ 850 Cost of goods sold (3

The following standard costs were developed for one of the products of Ferrars Company: Standard Cost Card Per Unit Materials: 4 feet x $14.25 per foot $ 57.00 Direct labor: 8 hour

Keira Knightley Company buys a piece of equipment for $36,442 that will last for 7 years. The equipment will generate cash flows of $7,000 per year and will have no salvage value a

Direct Material Price Variances The two direct material price variances can be summarized given as: From our basic data first before the beginning of the discussion on

The following are three independent situations where the reporting entity for which financial statements are being prepared are underlined. Every company has a December 31, 2012 ye

what are thereasons for holding inventories