Generate cash receipts in 2022

Assignment Help Financial Accounting

Reference no: EM133476352

Budget Development

Question 1: The Columbia Arena Company formed in 2021 and uses the accrual basis of accounting. Using the company's 2021 budget (attached), provide an operating budget for 2022 based on the following revenues and expense estimates:

a. The Arena is expected to generate cash receipts in 2022 as follows:

• All rent will increase by 4.7%
• Concessions Gross will increase by 5.0%
• Merchandise Gross, Suite Revenue, Club Seating Revenue, Advertising Revenue, and Naming Rights are forecasted to remain the same
• Box Office, Parking, and Ticket Fee revenues will decrease by 2.7%

b. It is forecasted that costs and expenditures will change in 2022 as follows:

• Merchandise COGS, G&A, Event Costs, and Maintenance will increase by 4.7%
• Concessions COGS will increase by 7.5%
• Utilities will increase by 8.0%
• Personnel will increase by 1.5%
• Insurance, Contract Services, Marketing, Management Fee, and Reserve are forecasted to remain the same

Question 2: After you have calculated the 2022 budget, suppose your boss asks you to revise it so that overall revenues increase by 4% and operating expenses decrease by 1.5%. Use the 2022 budget that you created in Part I and create a new 2022 budget based on the revenue increases and expense decreases outlined by your boss. If you completed Part I correctly, then the revenues increased by 2% and the expenses by 3%; therefore you must increase revenues another 2% (to get to the overall increase goal of 4%) and decrease expenses by 4.5% to get to get to the overall decrease expense goal of 1.5%). Your calculations do not have to be exact - just hit the targets that your boss has indicated as closely as you can.

Reference no: EM133476352

Questions Cloud

What are your thoughts on the natural evolution : Do you believe that reforming and/or defunding are part of the natural changing nature of policing? Are they in a continuum of change instead of existing

Write a reflection based on your experience : Write a reflection based on your experience. This reflection will constitute roughly two paragraphs. What did you learn from the materials?

Analyze how changes in the federal reserves monetary policy : University of Phoenix ECOCB 535 Analyze how changes in the Federal Reserve's monetary policy affect at least 2 of the 4 components of GDP (consumption, investme

Do you think sporting arenas should funded with public money : Do you think sporting arenas should be funded with public money? Yes or No?

Generate cash receipts in 2022 : The Columbia Arena Company formed in 2021 and uses the accrual basis of accounting

Describe the premise of the program : HSM 494 Norfolk State University - Describe the premise of the program and/or what goals you would want the program to achieve.

What does culture related to social class impact identity : In what ways does culture related to social class impact identity and pride within specific social classes?

Explore an idea related to native american culture : ENGL 2309- If you find Yellow Woman thought-provoking, you might explore an idea related to Native American culture.

Address social problems and issues : ISS 3923 Florida State University - Address social problems and issues from more than one disciplinary area of expertise. Be specific by listing course numbers

User Account

All Pages