Problem 1 The marketing department of New Generation Hotel is preparing its revenue budget for the year 20X2. The Hotel has 200 rooms and operates 365 days a year. For 20X1, the average room rate and the occupancy percentage were $150 and 80% respectively. The company's accountant has prepared the following forecast information for the year 20X1 in October 20X1 by incorporating 9 months actual and 3 months forecast. REVENUE Rooms Food & Beverage Spa TOTAL REVENUE 20X1 $8,760,000 $5,256,000 $876,000 $14,892,000 The following information relating to 20X2 has also been gathered: i. The management would like to increase the average room rate to $160 to cover rising costs, as a result of the higher room rate; occupancy is expected to drop to 78%. ii. Food & Beverage revenue varies with room night, the average Food & Beverage revenue is expected to be $90 per room night. iii. Spa revenue will go up to $903,670 because of price increases. Required: Based on the above information, prepare the budgeted revenue for the year ending 31 December 20X2.

Problem 1 The marketing department of New Generation Hotel is preparing its revenue budget for the year 20X2. The Hotel has 200 rooms and operates 365 days a year. For 20X1, the average room rate and the occupancy percentage were $150 and 80% respectively. The company's accountant has prepared the following forecast information for the year 20X1 in October 20X1 by incorporating 9 months actual and 3 months forecast. REVENUE Rooms Food & Beverage Spa TOTAL REVENUE 20X1 $8,760,000 $5,256,000 $876,000 $14,892,000 The following information relating to 20X2 has also been gathered: i. The management would like to increase the average room rate to $160 to cover rising costs, as a result of the higher room rate; occupancy is expected to drop to 78%. ii. Food & Beverage revenue varies with room night, the average Food & Beverage revenue is expected to be $90 per room night. iii. Spa revenue will go up to $903,670 because of price increases. Required: Based on the above information, prepare the budgeted revenue for the year ending 31 December 20X2.

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter8: Budgeting

Section: Chapter Questions

Problem 20E

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Subject: accounting
Question 2 The accountant for ABX Limited compiled the following cost information regarding the budgetary period of four moths. Sales in Kgs are expected to be 2000 per month for Jan, Feb, Mar and April. The selling price of K10 per Kg will remain uniform throughout the four months. The company is expected to have cash at hand of K15,000 at the beginning of the period. ABX Limited is expecting a particular debtor to settle his outstanding amount in January for K12,000. The possibility of collecting this amount is 100%. The accountant has also noted the following: The company will hire a grader for the first two months at K2000 per month. Prepared electricity will be paid only in Mar and April at K3000 for each month. Wages and salaries are expected to be K3500 on a monthly basis. Stationery is budgeted at K1,500 in month one and K2500 in month 2 and 3. Transport and fuel is expected to be K2500 per month for the entire period Repairs and maintenance for the build will…
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2019 Sales Cost of Goods Sold Rent Wages Insurance Utilities Auto Maintenance Advertising Other Expenses Total Expenses Net Income Jan 3,250 1,788 525 175 46 220 40 98 2,891 359 Feb 2,700 1,485 525 175 46 225 40 81 2,577 123 Mar 3,855 2,120 525 175 46 285 80 60 116 3,407 448 Tom's Business Income Statement 98 2,900 354 2019 May Jul Aug Sep Oct Nov Dec Total Apr 3,254 3,650 2,850 2,600 2010 2,200 2,250 3,755 4,890 37,264 1,790 2,008 1,106 1,210 1,238 2,065 2,690 20,495 525 525 525 525 525 525 6,300 2,100 175 175 175 175 175 175 46 46 46 46 46 46 550 227 265 210 185 220 230 2,657 40 40 40 80 640 60 147 525 175 46 200 40 110 Jun 588 * º * * * 88 * § 547 1,568 525 175 46 185 80 60 86 3,103 2,724 126 1,430 525 175 46 205 40 78 2,499 101 40 60 2217 (207) 80 60 66 2,372 (172) 68 2,276 (26) 113 3,184 3,952 571 938 240 1,118 34,100 3,164
Question 2 A manager is preparing a revenue budget for next month. The following is the manager's current month actual operating results. ACTUAL OPERATING RESULTS CURRENT MONTH Number of Guests Revenue Source Average Sale per Sales Guest Restaurant 3492 $20.50 $71,586 Lounge 515 $12.00 $ 6,180 Banquet room 388 $28.50 $11,058 4395 $20.21 $88,824 Total Create the revenue forecast for next month based on the following assumptions. A. Restaurant guest counts will be 3,600 with an average sale per guest of $21.00. B. Lounge guests to be served are estimated at 525 with a 10 percent increase in average sale per guest. C. The banquet room will serve 425 customers and generate $12,750 in sales.
A-3
H1. Account
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