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Shrute BnB-Tally Number of rooms 180 2019 228 ADR OCC RevPAR 82% 186.96 New Revenues Sales Mix REVENUE Rooms Food & Beverage Other Operated Departments Miscellaneous Income TOTAL REVENUE 12,283,272 3,261,673 376,416 102,168 16,023.529 Fixed Cost Variable Cost DEPARTMENTAL EXPENSES Rooms Food & Beverage Other Operated Departments TOTAL DEPARTMENTAL EXPENSES 3,684,981 750,184 143,109 4,578,274 TOTAL DEPARTMENTAL PROFITS 11,445,255 708,135 663.343 321,555 344,732 2,037,765 UNDISTRIBUTED OPERATING EXPENSES Administrative & General Marketing Utility Costs Property Operation & Maintenance TOTAL UNDISTRIBUTED OPERATING EXPENSES GROSS OPERATING PROFIT Franchise Fees Management Fees INCOME BEFORE FIXED CHARGES 9,407,490 736,996 752,599 7,917,895 SELECTED FIXED CHARGES Property Taxes Insurance Reserve For Capital Replacement 371,700 $3,600 171,090 EBITDA Depreciation Interest Expense Income Before Income Tax Income Tax Net Income 7,321,505 342,000 98,000 6,881,505 1,376,301 5,505,204 Total CMR New CMR Based on the income statement and the information below: The income tax rate is 20%. Number of rooms is 180, and hotel operates at 82% occupancy Room, Food & Beverage, and Other Operated Department expenses are directly variable with total sales revenue. Administrative & General: $400,000 is fixed, the remainder is variable with total revenue. Marketing $300,000 is fixed, the remainder is variable with total revenue, Utilities cost: $140,000 is fixed, the remainder is variable with total revenue. Property Operations & Maintenance: $275,000 is fixed, the remainder is variable with total revenue. Assume both franchise fees and management fees to be fixed. Answer the following questions based on the given information and the income statement. 1. What is the revenue at breakeven point? 2. At breakeven point, what would the room revenues be? 3. At breakeven point, what is the occupancy rate at $228 ADR? 4. What revenue is required to achieve desired operating income income before income tax) of $8,000,000? 5. If the operating income (income before income tax) of $8,000,000 achieved, how much would the food and beverage revenue be? 6. If rooms and food & beverage revenues increase by 20% and 30%, respectively, through price increases, what would the new breakeven be? 7. If fixed cost increases by $1,500,000, how much addtional revenues is needed to cover the additional fixed expenses? 8. What would the required revenue be if a net income of $10,000,000 is desired

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