Financial Analysis

Financial Analysis

Case Study Problem No # 1

The analysis shows that the breakeven pointy for visitors volume is 78,291. There are certain assumptions which are considered during the calculation of the breakeven point analysis. The inflows from the grants and supporting members have been deducted from fixed cost to arrive at breakeven point (Altman, 2012, pp. 604).



TMSAC

Breakeven Analysis of Visitors

Particulars

 

 

Amount in $

Fixed cost

 

 

985,000.00

Grants

 

 

564,000.00

Funds from Supporting members

112.75 1,255 141,501.25

Net Fixed cost

 

 

279,498.75

Variable Cost

 

 

 

Handouts

0.55

 

0.55

Electric cost

0.15

 

0.15

Tape Cost

0.38

 

0.38

Unit Variable Cost

 

 

1.08

 

 

 

 

Type of Visitors

Percent of total visitors

Price

Net revenue

Regular

65%

6

3.9

Group

15%

3

0.45

Senior Citizens

10%

2

0.2

Student

10%

1

0.1

Unit Selling price

 

 

4.65

 

 

 

 

Formula for Breakeven point

 

 

 

Total Fixed Cost/(Unit Selling Price - Variable cost)

 

 

Breakeven visitors volume

 

 

78,291

Case Study Problem No # 2

The revenue from visitors is calculated on the basis of selling price determine in breakeven point analysis. The variable cost of each visitor calculated in breakeven point analysis is also used in determining expenses of visitors.

TMSAC

Estimated Budget for the year 2010

Particulars

Quarter 1

Quarter 2

Quarter 3

Quarter 4

2010 (Full Year)

Revenue Sources:

 

 

 

 

 

Visitors

55,800.00 93,000.00 167,400.00 55,800.00 372,000.00

Membership

56,600.50 28,300.25 28,300.25 28,300.25 141,501.25

Grant

141,000.00 282,000.00 56,400.00 84,600.00 564,000.00

Shop

 

40,000.00 72,000.00 24,000.00 136,000.00

Total Revenues

253,400.50 443,300.25 324,100.25 192,700.25 1,213,501.25

Expenses

 

 

 

 

 

Fixed Expenses

246,250.00 246,250.00 246,250.00 246,250.00 985,000.00

Unit Variable Cost

12,960.00 21,600.00 38,880.00 12,960.00 86,400.00

Shop Expenses

 

26,000.00 46,800.00 15,600.00 88,400.00

Total Expenses

259,210.00 293,850.00 331,930.00 274,810.00 1,159,800.00

Budgeted gain or (loss) of revenue over expenses

(5,809.50)

149,450.25 (7,829.75)

(82,109.75)

53,701.25

Case Study Problem No # 3

The analysis indicated that the exhibit is not self sufficient in financing the capital requirements for itself. The analysis showed that there will be a need of grant amounting to $ 138,586 because total expected expenses which will be incurred on exhibit are more than the revenue that the incremental visitors will bring (White et.al, 2003, pp. 75).

TMSAC

Estimation of Financial requirements

Particulars

Amount in $

Upgrade cost

175,000.00

Incremental Visitors per month

850.00

Unit Variable Cost

1.08

Unit Selling price

4.65

Incremental Visitors Cost on monthly basis

918.00

Revenue from incremental visitors on monthly basis

3,952.50

Incremental Visitors Cost on yearly basis

11,016.00

Revenue from incremental visitors on yearly basis

47,430.00

Total expected revenue of exhibit yearly (from incremental visitors)

47,430.00

Total cost of exhibit & incremental customer yearly

186,016.00

Projected shortfall

(138,586.00)



Pg. 268 Question Number # 7-29



Millbridge Receivables Aging Schedule

Payer

1-30 Days

31-60 Days

61-90 Days

> 90 Days

Total

By Total Dollars

 

 

 

 

 

 

Medicare

2,500,000

1,000,000

1,500,000

5,000,000

 

Medcaid

900,000

900,000

900,000

300,000

3,000,000

 

Insurance

2,000,000

2,000,000

4,000,000

 

Self pay

500,000

500,000

500,000

500,000

2,000,000

 

Total

5,900,000

4,400,000

2,900,000

800,000

14,000,000

By Percent

 

Medicare

50%

20%

30%

100%

 

Medcaid

30%

30%

30%

10%

100%

 

Insurance

50%

50%

100%

 

Self pay

25%

25%

25%

25%

100%

 

Total

42%

31%

21%

6%

100%

Pg. 268 Question Number # 7-31

Billings Village

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