Revenue Estimates
Revenue Item 100% Monthly 75% Monthly 50% Monthly Notes
Rooms $2,956,500 $2,217,375 $1,478,250 8,100 daily
Leases $180,000 $135,000 $90,000
TOTAL REVENUE $3,136,500 $2,352,375 $1,568,250
Expences
TOTAL VARIABLE COSTS $454,000 $340,500 $227,000
TOTAL FIXED COSTS $1,403,000 $1,403,001 $1,403,002
TOTAL EXPENSE BEFORE IT $1,857,000 $1,743,501 $1,630,002
EBIT $1,279,500 $608,874 -$61,752 Depreciation $320,000 $320,001 $320,002
EBITDA $1,599,500 $928,875 $258,250 Furnishing Interest $110,000 $110,000 $110,000
20yr Mortgage Interest $182,000 $182,000 $182,000
TOTAL INTEREST $292,000 $292,000 $292,000 TAXES (40%) $395,000.00 $126,749.60 -$141,500.80
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$135,000 $90,000
TOTAL REVENUE $3,136,500 $2,352,375 $1,568,250
Expences
TOTAL VARIABLE COSTS $454,000 $340,500 $227,000
TOTAL FIXED COSTS $1,403,000 $1,403,001 $1,403,002
TOTAL EXPENSE BEFORE IT $1,857,000 $1,743,501 $1,630,002
EBIT $1,279,500 $608,874 -$61,752 Depreciation $320,000 $320,001 $320,002
EBITDA $1,599,500 $928,875 $258,250 Furnishing Interest $110,000 $110,000 $110,000
20yr Mortgage Interest $182,000 $182,000 $182,000
TOTAL INTEREST $292,000 $292,000 $292,000 TAXES (40%) $395,000.00 $126,749.60 -$141,500.80 Furnishing Principal $180,160 $180,160 $180,160
20yr Mortgage Principal $49,713 $49,713 $49,713
TOTAL PRINCIPAL $229,873 $229,873 $229,873
NET INCOME $362,627 -$39,749 -$442,124
DIVIDEND PAYMENT $29,010 -$3,180 -$35,370 RETAINED EARNINGS $333,617 -$36,569
EBIT/INTEREST 4.38 2.09 (0.21)
EBITDA/INTEREST 5.48 3.18 0.88
BURDEN $675,121.67 $675,121.67 $675,121.67
EBIT/BURDEN 1.90 0.90 (0.09) ROE= Net Income/OE (H1) 32.97% -3.61% -40.19% Revenue Estimates
Revenue Item 100% Monthly 75% Monthly 50% Monthly
Rooms $2,956,500 $2,217,375 $1,478,250
Leases $180,000 $135,000 $90,000
TOTAL REVENUE $3,136,500 $2,352,375 $1,568,250
Expences
TOTAL VARIABLE COSTS $454,000 $340,500 $227,000
TOTAL FIXED COSTS $1,403,000 $1,403,001 $1,403,002
TOTAL EXPENSE BEFORE IT $1,857,000 $1,743,501 $1,630,002
EBIT
Debt to Equity ℎℎ ′ 9,771+1,885 Dividend Payout Inventory Turnover = 0.069 Working backwards from the income tax expense, we estimate income tax rate to be 34%. NOPAT is then Operating profit taxes, or 3,137*(1-0.34) = 0.319 Average
May June July August September October November December Average Total Rooms Occupancy Occupied Percent 126 150 154 162 163 159 156 162 154 186 149 118 153 51.6% 61.4% 63.1% 66.2% 66.7% 65.3% 64.0% 66.4% 63.2% 76.4% 61.0% 48.3% 62.8% Total ADR $140.27 $139.29 $141.80 $140.20 $143.72 $141.90 $139.11 $141.54 $145.08 $157.36 $148.66 $137.38 $143.03
Lambert Hotel is in second rounds of negotiations with AAA HotelCo of a possible merger between the two companies. Lambert is a strong brand with a luxurious and upscale tres comfortable Michelin rating, and AAA is rated at mid-scale category of equivalent ranking. Culturally, there is a difference in the approach to business mergers. Time wise, Lambert is eager to close the merger with AAA or consider the alternative value that is a safe bet.
The purpose of this case is to determine which key variables drive Crusty Pizza Restaurant’s monthly profit and then forecast what the monthly profit would be for potential stores. Based off of this information we will be able to make a recommendation to Crusty Dough Pizza Restaurant on which stores they should open and which they avoid. The group was provided 60 restaurants’ data that included monthly profit, student population, advertising expenditures, parking spots, population within 20 miles, pizza varieties, and competitors within 15 miles. For the potential stores we were given all of this
* We increased this costs as a percent of revenue 2.7% over the previous year for all forecasted periods
In this table, it reflects the changes in fixed plant overhead from $420,000 to $378,000. The company still has the fixed selling and administrative expense per quarter of $118,000. The new company fixed overhead is now at $496,000 from the past $538,000 ($42,000) change from past to
2.) For each expense that is variable with respect to revenue hours, calculate the cost per revenue hour.
The reason for the high gross profit ratio for the finance participation income is that there are little to no costs relating to this income. The amount of gross profit for the home sales is higher
In May 2006, Westmount Retirement Residence was having very low profitability. Its very simple pricing model essentially charged each resident the same price per month regardless of their needs. This was due to a change in the patients´ demands. In the past, patients´ demands were similar and therefore the company´s pricing and costing system was appropriate. But changes in the population and in the requirements of the residents caused that the pricing model remained out of date and the costing system inappropriate. One of the problems observed when analyzing the company´s situation was that due to the costing system used it was not possible to have a clear picture of how much each of the services offered were costing. Consequently, it was clearly very difficult being able to define a pricing system that will give the shareholders the desired profit. The first step was to design a new costing system adequate for the company
The revenue is $600,600*1.2= $720,720. The variable cost changes as sales increases and fixed cost stays the same, the gross profit is $175,500. After tax, the net income is $100,557.
In review of the operating costs, overhead and administration have increased by 8% from 2008-2011 or $116,870. In addition salary dollars continue to increase from 2008-2011 by $111,150 with no efforts to flex. The other expenses are staying steady in proportion to gross revenues. There may be opportunities in these areas however salaries and overhead is the greatest opportunity to scale back costs and contribute to increased net income and ultimately positive cash flows. Flexing salaries and benefit to 44% of gross revenue and reducing overhead and expenses to 10% of gross revenue is recommended for Ms. Ringer to increase net income to $152,956 and equity to $240,214 (exhibit Operating Statements-2012 proforma).
Types of expense |1 |2 |3 |4 |5 |Total | | | | | | | | | |Gas |$3,600.00 |$3,600.00 |$3,600.00 |$3,600.00 |$3,600.00 |$18,000.00 | |Repairs and Maintenance |$800.00 |$928.00 |$1,048.00 |$1,160.00 |$1,264.00 |$5,200.00 | |Tires | |$760.00 |$760.00 |$760.00 |$760.00 |$3,040.00 | |Insurance |$2,400.00 |$2,400.00 |$2,400.00 |$2,400.00 |$2,400.00 |$12,000.00 | |Registration and taxes |$848.00 |$720.00 |$600.00 |$488.00 |$384.00 |$3,040.00 | |Depreciation |$9,720.00 |$5,832.00 |$3,500.00 |$2,100.00 |$1,348.00 |$22,500.00 | |Purchase
Ms. Ringer is largely supporting operations through her line of credit versus managing costs. In review of the operating costs, overhead and administration have increased by 8% from 2008-2011 or $116,870. In addition salary dollars continue to increase from 2008-2011 by $111,150 with no efforts to flex. The other expenses are staying steady in proportion to gross revenues. There may be opportunities in these areas however salaries and overhead is the greatest opportunity to scale back costs and contribute to increased net income and ultimately positive cash flows. Flexing salaries and benefit to 44% of gross revenue and reducing overhead and expenses to 10% of gross revenue is recommended for Ms. Ringer to increase net income to $152,956 and equity to $240,214 (exhibit Operating Statements-2012 proforma).
From the description of the case study, it seems that the reason lead the Portman Hotel to this terrible situation was that their HR policies were inconsistent with its strategies. The Portman Hotel's philosophy is that if they want their customers treated better, they must treat each other better. They also think the Portman Hotel is a place where they can make their employees feel satisfied with their jobs. Their jobs will be fun and they will fulfill their expectations. The employees will have the best work experiences. Besides, the Portman Hotel expects to be the best employer in San Francisco. They are willing to show their trust and pride in their employees. That's why the hotel considered their "associates" of the highest potential,
The hotel industry is one of the most prolific industries in Australia due to its presence in society and, the impact it has on the nation’s economy. Advances in technology since the end of the 20th Century have allowed the service market of a hotel to develop rapidly (Hilton Melbourne South Wharf