Costing and Recommendations for a Proposed New Charity and Service

You have been asked by the trustees to assist them in determining what decision to make. To assist them cost out the two different approaches proposed by the trustees above and make your recommendations to the trustees.

What other observations and recommendations relating to the proposed new charity and service would you make to the trustees?

1. When working out student occupancy numbersagainst percentage numbers you apply the rule that point 5 and above is rounded up and point 4 and below is rounded down. E.G – 5 becomes 9.

2. In answering question 2 you are encouraged to use the full knowledge you have acquired from all elements of the module.

You have been asked by the trustees to assist them in determining what decision to make. To assist them cost out the two different approaches proposed by the trustees above and make your recommendations to the trustees.

What other observations and recommendations relating to the proposed new charity and service would you make to the trustees.

1. When working out student occupancy numbersagainst percentage numbers you apply the rule that point 5 and above is rounded up and point 4 and below is rounded down. E.G – 5 becomes 9.

2. In answering question 2 you are encouraged to use the full knowledge you have acquired from all elements of the module.

The training programmes are planned to provide as much hands on experience as possible and will last for three months each. Each will be repeated three times a year. The site will be closed for the remaining three months of the year for staff holidays, refurbishment etc. To ensure maximum learning the number of persons allowed on each of the training programmes at any one time will be restricted to 12.

Following a review it has become apparent that only three of the planned programmes can be accommodated in the 10,000 sqmt space. Unfortunately the admin space cannot be utilised for course delivery.

Each training programme will require its own tutor and set of training materials charged at daily rates and miscellaneous consumables which vary by student numbers.  

Detailed costings for each of the four training programmes and the premises as a whole are provided below. A unit of output has been defined as a training day for the maximum of 12 participants. For the nine months available in each year the number of training days will be 180 days per annum or 60 days per term. The cost for each training day will differ according to the type of training programme.

The other fixed premises costs are estimated at £50,000 p.a. and indirect overhead costs are estimated at £30,000 p.a.

Following the review, the trustees now have to decide which training programmes to offer. One trustee believes that first priority should be given to the Introduction course, then the Building course and finally the Intermediate as they have the highest course fees and take up rate.

That trustee is opposed by another trustee member who disagrees. This trustee has taken the view that because of the restrictions imposed by the available floor space only those training programmes that maximise the contribution per sqmt to the annual fixed overheads should be accepted.