Answers Problem 2Prepare the annual operating expense budget for the next year using the formulas fromproblem 2 and the following assumptions. Remember there are 13 accounting periods ina fiscal year, each with four weeks and 28 days.Room Revenue $19,184,000Transient Rooms Sold 184,000Group Rooms Sold 34,000Total Rooms Sold 218,000Operating Expense Annual BudgetLinen $5,183 * 13 Periods $ 67,379Cleaning Supplies .24 Cents * 218,000 $ 52,320Rooms SoldGuest Supplies $1.05 *218,000 $228,900Laundry $250,000 * 70% $175,000Annual Laundry Department Budget$250,000Concierge Expense .69% * $19,184,000 $132,370Office Supplies .22% * $19,184,000 $42,211Reservation ExpenseReservation Department Cost$25,000 * 13 Periods $325,000Fixed Reservation Center Cost600 Rooms * 13 Periods *$50 $390,000Variable Reservation Center Cost184,000 * 50% * $6 $552,000Total Reservation Expense $1,267,000All Other Expense $20,000 * 13 periods $ 260,000Total Operating Expenses in Dollars $2,225,180Total Operating Expense as a Percentage 11.6%
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