Consulting Firm's Letter to CRC Regarding New Fee Structure Evaluation

Evaluation of CRC's New Fee Structure

Required:

Your consulting firm has been hired to help CRC evaluate its new fee structure. Write a letter to the club’s president answering the following questions.

1.Will City Racquetball Club’s new membership plan and fee structure improve its ability to plan its cash receipts? Explain your answer.

2.City Racquetball Club should evaluate the new membership plan and fee structure completely before it decides to adopt or reject it.

a.Identify the key factors that CRC should consider in its evaluation.

b.Explain what type of financial analyses CRC should prepare in order to make a complete evaluation.

3.Explain how City Racquetball Club’s cash management would differ from the present if the new membership plan and fee structure were adopted.

1.Describe several operational and behavioral benefits that are generally attributed to a participative budgetary process.

2.Identify at least four deficiencies in Patricia Eklund’s participative policy for planning and performance evaluation purposes. For each deficiency identified, recommend how it can be corrected.