Past Final Exam Part I Operations Budgets A Joanna Fee is the dining room manager of the Athens Club The wages budget for her department are divided between fixed and variable expenses The work standard for waitpersons is to serve 10 members per hour The average wage rate per hour is 8 00 The variable wages budget for waitpersons for June is based on 8 00 per hour eight hour shifts 30 days in the month and an average of 8 waitpersons per day During the month of June the waitpersons wages totaled 17 000 During June 2 000 hours were worked In addition 24 000 members were provided service by the waitpersons Required 1 Complete the table below Covers Hours Hourly Rate Total Budget Actual Difference 2 Explain if the budget variance determined in 1 above is significant Provide the significance criteria in your explanation 3 Rate J Fee s performance in managing the waitpersons Support your discussion with specific numbers 1 Part II Pricing A proposed hotel Willards is scheduled to open in one year The business will be organized as a sole proprietorship The owner Monica Willards seeks your advice on pricing Although she knows she will have to modify your recommendations based on market prices she desires a cost perspective She gives you the following information Monica s investment Monica s desired ROI Monica s average tax rate Funds borrowed Interest rate 5 000 000 25 25 5 000 000 10 annual Forecasted annual costs Fixed charges other than interest expense and property taxes Property taxes Management fees Rooms department expenses Undistributed operating expenses 500 000 200 000 3 of room sales and 100 000 per year 10 of room revenue plus 100 000 per year 300 000 Other profit center s activities Food and beverage Telecommunications 50 000 annual profit 10 000 annual loss Assume Willards has 150 guest rooms and it expects to have paid occupancy of 65 Required 1 Determine the required ADR 2 Assume Willards has four types of rooms as follows Singles doubles kings and suites The kings are priced at 20 more than the doubles and the doubles are 10 higher than the singles while the suites are priced at twice the single price Forty percent of the rooms sold are doubles 20 sold are kings and 10 of suites What is the average price of a king and a suite 2 Part III Payroll Expenses R Stone a non supervisory employee earns 200 per 40 hour workweek at the Princess Caf During the twoweek period of February 4 17 he worked an average of 50 hours per week Assume the following 1 2 3 4 5 Assume the federal income tax 14 Assume the FICA rate is 7 65 Assume the state withholding rate is 4 6 SUTA rate is 5 2 FUTA rate is 1 0 Required 1 Calculate Stone s gross and net pay 2 Prepare the journal entry to record the payroll expense related to his labor 3