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The owner of a local motel told you to help him set up his budget...

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Accounting

The owner of a local motel told you to help him set up his budget with the following information:

Its monthly Fixed Cost amount is $120,000, while its Variable Cost is $15 per room sold.

During the slowest month, he will reduce his ADR to $30 to sell 6,000 rooms. However, the Variable Cost per room will not change. Using the information provided, complete the Pro Forma Income Statements (Operating Budget); and provide your answer to the question below.

Slowest month

(6,000 rooms to sell @ lowered ADR of $30)

Vertical Analysis (%)

Revenues: $180,000 XXXXXX

Variable Cost ($15 per room): __(25)___ __(30)___

Contribution Margin: __(26)___ __(31)___

Fixed Cost: $120,000 __(32)___

EBT: __(27)___ XXXXXX

Tax (40%) __(28)___ XXXXXX

Net Income: __(29)___ __(33)___

1. Provide your answer to the amount of (25)

2. Provide your answer to the amount of (26)

3. Provide your answer to the amount of (27).

4. Provide your answer to the amount of ( 28).

5. Provide your answer to the amount of (29).

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