COST–VOLUME–PROFIT ANALYSIS Case Assignment The Annie Smith Dance Center

Module 2 – CaseCOST–VOLUME–PROFIT ANALYSISCase AssignmentThe Annie Smith Dance CenterThe Director of Annie Smith Dance Center is asking forassistance with the financial aspects of running aprofessional group of performers. She wants financialinformation presented in an easy to read format and abetter understand of the profitability of the concerts andthe organization as a whole.The Annie Smith professional group features four danceconcerts each year. Three of the dance concertsshowcase a different genre. The fourth performance is aChristmas Spectacular, which is the most popular danceconcert and is therefore scheduled every year. Ms.Smith has tentatively scheduled the following four danceconcerts for the coming season. The schedule belowshows the type and number of performances and directcost per type of concert. Examples of direct fixed costsare costumes, rehearsals, royalties, guest artist fees,choreography, and salaries of production staff, music,and wardrobe for each of the four concerts.DescriptionsNumber ofPerformancesCost per Dance Concert (directfixed costs)Hip Hop Concert10$45,000Jazz and Tap Dance588,000Modern Dance1095,000ChristmasSpectacular2025,000$253,000Additional costs:Variable costs associated with each performance areshown below.Musicians$7,500Rental of auditorium2,500Dancers’ compensation7,000General administrative and operating costs for thedance center are:Administrative staff$185,000Insurance25,000Marketing215,000General office expenses90,000Lower Orchestra Section (A)Upper Orchestra Section (B)DescriptionsNo.ofSeatsTicketPriceTickets SoldperPerformanceNo.ofSeatsTicketPriceTickets SoldperPerformanceHip HopPerformance150$85100%450$5090%Jazz and TapDance150$85100%450$5060%ModernDance150$85100%450$5095%ChristmasSpectacular150$125100%450$50100%Required:Computations (use Excel)Summarize key financial information in a table as shownbelow.TitleNam Revenues/PerVariableContributioe offormanceCosts/PerfonDanMargin/PerfceormanceTotalContribution/Type ofDanceDir SegmenecttFix Margined /Type ofConcertrmanceConcert1.2.3.4.TotalPrepare a segmented income statement in good format.Compute the number of performances required to breakeven for each concert. These are separate computationsfor each dance concert.Compute break even for the organization as a whole andexpress the result in revenues instead of the number ofperformances.Ms. Smith wants to performance group to show at least$150,000 in operating profit. What level of revenues doesthe performance group need to achieve to meet this goal?Give a recommendation about changes Ms. Smith canmake to achieve the target profit. Support your idea withcomputations.Memo (use Word)Write a four or five paragraph memo to the owner of thedance center to assist her in interpreting the financialanalysis. Start with an introduction and end with aCosConcerttsrecommendation. Each of the four or five paragraphsshould have a heading.Short Essay (use Word)Start with an introduction and end with a summary orconclusion. Use headings.What are some shortcomings of multi-product evenanalysis?How does demand and resource constraints affect thistype of analysis.Assignment ExpectationsEach submission should include two files: (1) An Excelfile; and (2) A Word document. The Word documentshows the memo first and short essay last. Assume aknowledgeable business audience and use requiredformat and length. Individuals in business are busy andwant information presented in an organized and concisemanner.Privacy Policy | Contact