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Exercise 11.1 The child and family government benefits seminar

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Exercise 11.1
The child and family government benefits seminar was such a success that Advocates
for Children will conduct a second seminar in an adjoining community. The
executive director decides that this second seminar will attempt to maximize revenues.
Consequently, no reduced fee schedule will be offered. All trainees will pay
the full seminar fee. The seminar will take place in a smaller conference room than
158
C H A P T E R 1 1
TABLE 11.5 Computing the Effect of Variable Fees on Seminar Revenues
60 trainees @ $116 = $6,960.00
50 trainees @ $116 = $5,800.00
10 trainees @ $ 58 = 580.00
Revenue $6,380.00
Revenue loss on 10 half-priced fees = $6,960.00
6,380.00
$ 580.00 (revenue loss)
$ 580.00
Increase in full fee to offset revenue loss = $11.60
50
Adjusted full fee = $ 128.00 ($116 + $12)
Revenue computations:
60 trainees @ $116.00 = $6,960.00
50 trainees @ $128.00 = $6,400.00
10 trainees @ $ 58.00 = 580.00
$6,980.00
Financial Management for Human Service Administrators, by Lawrence L. Martin. Copyright © 2001 by Allyn and Bacon, a Pearson Education Company.

the earlier one. The room can only accommodate a maximum of 45 trainees. Here
is the proposed budget for the seminar:
Proposed Seminar Budget
1. Conference room rental $175.00 $ 175.00
2. Audiovisual equipment Rental 75.00
3. 4 presenters @ $500 2,000.00
4. 45 workbooks @ $15 675.00
5. 45 lunches @ $12 540.00
6. 45 coffees @ $3.50 158.00
Subtotal $3,623.00
7. Indirect costs @ 25% of $3,675.00 $ 906.00
Subtotal $4,529.00
8. Profit margin @ 5% of $4,594.00 $ 227.00
Total $4,756.00
You are the executive director. Following the checklist in Figure 11.1, perform
all the computations necessary to set a fee. What will your fee be? What is your
break-even point? What is your go/no-go decision point?
Exercise 11.2
As the executive director of Advocates for Children, you have had a change of
heart. You decide not to attempt to maximize revenues in this second seminar. You
decide to exclude a profit margin in the fee computation, but you will include indirect
costs. Additionally, the local United Way in the community hosting the seminar
has guaranteed 45 participants. If fewer than 45 participants register for the
seminar, the United Way will make up the difference. In exchange for this guarantee,
the United Way has asked you to set the seminar fee as low as possible. Following
the checklist in Figure 11.1, perform all the computations necessary to set a
fee. What will your fee be?
Submitted: 8 years ago.
Category: Homework
Expert:  Neo replied 8 years ago.
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