Actual 2016 Assumptions for 2017 forecast Occupied Rooms 60,500 * occupied rooms

Question

Actual 2016 Assumptions for 2017 forecast Occupied Rooms 60,500 * occupied rooms will increase by 1,000 Rooms revenue 7,562,500 * the average rate will increase by 5% Wages and benefits 1,300,750 * wages and benefits cost per occupied room Other Expenses 568,000       will increase by 4% Rooms Profit 5,693,750 * other expenses will decrease by 2% 5,693,750 Using the assumptions listed above, what will the 2017 forecast rooms profit be? Actual 2016 Assumptions for 2017 forecast Occupied Rooms 60,500 * occupied rooms will increase by 1,000 Rooms revenue 7,562,500 * the average rate will increase by 5% Wages and benefits 1,300,750 * wages and benefits cost per occupied room Other Expenses 568,000       will increase by 4% Rooms Profit 5,693,750 * other expenses will decrease by 2% 5,693,750 Using the assumptions listed above, what will the 2017 forecast rooms profit be?

Explanation / Answer

Calculation of 2017 forecast rooms profit Rooms Revenue (61500 rooms * $131.25) $8,071,875 Less : Expenses - Wages and benefits (61500 rooms * $22.36) $1,375,140 - Other expenses ($568000*98%) $556,640 2017 Forecast rooms profit be $6,140,095 Working Average revenue per occupied room in 2016 = Rooms revenue / Occupied Rooms = $7562500 / 60500 rooms = $125 per occupied room Wages and benefits cost per occupied room in 2016 = Wages and benefits cost / Occupied rooms = $1300750 / 60500 rooms = $21.50 per occupied room Forecasted Average revenue per occupied room in 2017 = $125 * 105% = $131.25 per occupied room Forecasted Wages and benefits cost per occupied room in 2017 = $21.50*104% = $22.36 per occupied room

Related Questions

Navigate

• Browse (All)
• Browse A
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.