ACC650_T5.docx Case 9-45 Using Budgets to Evaluate Business Decisions and Case 9-46 Par
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ACC650_T5.docx Case 9-45 Using Budgets to Evaluate Business Decisions and Case 9-46 Participative Budgeting Grand Canyon University: ACC650 Case 9-45 Using Budgets to Evaluate Business Decisions 1.Currently, City Racquetball Club or (CRC) is deriving its revenue from two sources. These two sources are the annual membership fees which are $40 for individuals, $25 for students and $95 for families. The second revenue source is from the hourly court fees which vary from $6 to $10 depending upon the season and time of day. Under the current plan the annual membership fees are a fixed cost, however, the hourly court fees vary year to year based on court usage during peak season and off-season.The new membership plan and fee structure would improve CRCs ability to plan its cash receipts because the cash flows would be more predictable and because the annual fee would be a fixed rate without having the variable rate of the hourly court cost. 2.a. According to Amanda Jesnoewski the key factors that CRCs management should consider in its evaluation prior to adopting or rejecting the new membership plan and fee structure include: 1.The cost, which include the fixed cost of the annual membership fees and the direct cost, which are the expenses incurred by delivering the services. 2.Ensuring the current customers are comfortable and willing to pay the higher prices for the services. 3.The positioning of the company. Where does CRC want to be in the market and where does CRC currently sit in
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- Submitted On 26 Jul, 2022 01:03:57
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