Cecily Good is the director of the Young Minds Childcare Centre and recently hired you as the financial controller. You have worked mainly in the for-profit sector as a business analyst for various manufacturing companies. This is the first non-profit organization that you have worked for, and you are excited about the programs and services the centre offers. Cecily is hoping your knowledge of management accounting will help her assess the viability of each of the programs that are run through the centre. The centre has three programs: Snuggles, Smart Kids and Mosaic. Snuggles is s program that provides early childcare for children age 12 months to 3 years. Smart Kids is an early literacy program for preschoolers age 4 to 5, while Mosaic is a blend of educational and fun after-school programs for kids ages 5- 12 years. Cecily has prepared the following analysis of each of the programs at the centre: Snuggles Smart Kids Mosaic Total Students at capacity 25 40 50 115 Actual number of students 24 38 45 107 Fee per Student per Month 300 200 300 Variable cost per Student 160 50 $ 95 Contribution Margin per Student 140 150 205 3,360 $ 5,700 $ 2,000 $ 3,478 $ 222 $ Total CM per month 9,225 $ 18,285 2,500 $ 2,174 S Program fixed costs 4,300 8,800 Allocated fixed costs* $ 4,348 $ 10,000 Surplus (Deficit) -$ 1,314 $ 577 -S 515 *Cecily has allocated facility rent and utilities over the three programs based on student capacity. Cecily's main goal is to breakeven on her costs each year. The centre receives no external funding but has been able to maintain operations on a fee-for-usage basis. However, looking at the above numbers, Cecily is feeling that maybe the Snuggles program is creating an overall deficit for the center. She has asked you to investigate whether the Snuggles program should be discontinued. Required 1. Prepare a monthly income statement reflecting the changes if the Snuggles program was discontinued by filling in the following form. Based on your analysis, should the program be discontinued? Young Minds Childcare Centre Monthly Projected Income Statement Smart Kids Mosaic Total Revenues Variable cost Contribution Margin Program fixed costs Allocated fixed costs Surplus (Deficit)

Cecily Good is the director of the Young Minds Childcare Centre and recently hired you as the financial controller. You have worked mainly in the for-profit sector as a business analyst for various manufacturing companies. This is the first non-profit organization that you have worked for, and you are excited about the programs and services the centre offers. Cecily is hoping your knowledge of management accounting will help her assess the viability of each of the programs that are run through the centre. The centre has three programs: Snuggles, Smart Kids and Mosaic. Snuggles is s program that provides early childcare for children age 12 months to 3 years. Smart Kids is an early literacy program for preschoolers age 4 to 5, while Mosaic is a blend of educational and fun after-school programs for kids ages 5- 12 years. Cecily has prepared the following analysis of each of the programs at the centre: Snuggles Smart Kids Mosaic Total Students at capacity 25 40 50 115 Actual number of students 24 38 45 107 Fee per Student per Month 300 200 300 Variable cost per Student 160 50 $ 95 Contribution Margin per Student 140 150 205 3,360 $ 5,700 $ 2,000 $ 3,478 $ 222 $ Total CM per month 9,225 $ 18,285 2,500 $ 2,174 S Program fixed costs 4,300 8,800 Allocated fixed costs* $ 4,348 $ 10,000 Surplus (Deficit) -$ 1,314 $ 577 -S 515 *Cecily has allocated facility rent and utilities over the three programs based on student capacity. Cecily's main goal is to breakeven on her costs each year. The centre receives no external funding but has been able to maintain operations on a fee-for-usage basis. However, looking at the above numbers, Cecily is feeling that maybe the Snuggles program is creating an overall deficit for the center. She has asked you to investigate whether the Snuggles program should be discontinued. Required 1. Prepare a monthly income statement reflecting the changes if the Snuggles program was discontinued by filling in the following form. Based on your analysis, should the program be discontinued? Young Minds Childcare Centre Monthly Projected Income Statement Smart Kids Mosaic Total Revenues Variable cost Contribution Margin Program fixed costs Allocated fixed costs Surplus (Deficit)

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter12: Balanced Scorecard And Other Performance Measures

Section: Chapter Questions

Problem 4EA: Sara has just taken a job as the middle school assistant principal for an area school district....

See similar textbooks