Training recently started a business providing training events for corporations. In order to better understand the

Question

Training recently started a business providing training events for corporations. In order to better understand the profitability of the? business, the owners asked you for an analysis of costs—what costs are? fixed, what costs are? variable, and so? on, for each training session. You have the following cost? information: LOADING... ?(Click the icon to view the? information.) Trainer: $16,000 per session ?Materials: $2,900 per session and $33 per attendee Catering Costs? (subcontracted): ?Food: $50 per attendee ?Setup/cleanup: $26 per attendee Fixed? fee: $8,000 training session Big Sky Training is pleased with the service they use for the catering and have allowed them to place brochures on each dinner table as a form of advertising. In? exchange, the caterer gives Big Sky Training a $1,400 discount per session. Requirement 2. Suppose 150 persons attend the next event. What is Big Sky ?Training's total net cost and the cost per? attendee? ?(Round your answers to the nearest? cent.)

Help In Homework · Accepted Answer

1) Variable cost per attendee: Materials 33 Food 50 Setup/Cleanup 26 Total Variable cost Per Attendee 109 Fixed Cost: Materials 2900 Trainer 16000 Catering 8000 Offset for brochures -1400 Total Fixed Cost 25500 2) Total Net Cost = Variable Cost + Fixed Cost = (150 * 109 ) +25,500 $41,850.00 Cost per Attendee ($41,850/150 persons) $279.00 per attendee 3) Total Net Cost = Variable Cost + Fixed Cost = (225 * 109 ) +25,500 $50,025.00 Cost per Attendee ($50,025/225 persons) $222.33 per attendee 4) Big Sky Training should charge customers based on Cost plus pricing method As the number of attendees increase, national Training could offer price discounts because its fixed costs would be spread over a larger number of attendee.

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Training recently started a business providing training events for corporations

Expert Solution

Archived Solution

1)
Variable cost per attendee:
Materials	33
Food	50
Setup/Cleanup	26
Total Variable cost Per Attendee	109

Fixed Cost:
Materials	2900
Trainer	16000
Catering	8000
Offset for brochures	-1400
Total Fixed Cost	25500

2)
Total Net Cost = Variable Cost + Fixed Cost = (150 * 109 ) +25,500	$41,850.00
Cost per Attendee ($41,850/150 persons)	$279.00	per attendee

3)
Total Net Cost = Variable Cost + Fixed Cost = (225 * 109 ) +25,500	$50,025.00
Cost per Attendee ($50,025/225 persons)	$222.33	per attendee