1. Critically examine the calculations and projections made by the tax accountants. The tables are all provided in an Excel worksheet on Brightspace.
2. Provide an alternate set of calculations (in contribution format by course) to provide further insight to Sophie on the profitability of each of the proposed culinary courses.
a. The per-student cost calculation of $298 for all courses is a gross average based on a number of assumptions and grouping of all costs.
b. Advertising and Marketing costs are treated as common costs and shared equally.
c. Use the concept of traceable costs and cost drivers to directly assign or allocate the applicable Fixed and Indirect costs to the courses.
d. Identify what costs are truly common or shared and should not be assigned to the courses.
e. Without changing the number of courses or students or pricing what is a more accurate profitability of each of the courses
3. What price per student per course is necessary for Sophie to at least break even?
⦁ Just need calculate and display with our excel file
4. Suggest some strategic and operational factors that Sophie should consider to improve the profitability of LBEC before going ahead with the project. For example:
a. Pricing strategy of the different courses – target markets, competition, etc. Should it be the same for all courses?
