Question

Kenton and Denton Universities offer executive training courses to corporate clients. Kenton pays its instructors $6,100 per course taught. Denton pays its instructors $305 per student enrolled in the class. Both universities charge executives a $347 tuition fee per course attended. Required Prepare income statements for Kenton and Denton, assuming that 20 students attend a course. Kenton University embarks on a strategy to entice students from Denton University by lowering its tuition to $227 per course. Prepare an income statement for Kenton assuming that the university is successful and enrolls 40 students in its course. Denton University embarks on a strategy to entice students from Kenton University by lowering its tuition to $227 per course. Prepare an income statement for Denton, assuming that the university is successful and enrolls 40 students in its course. Prepare income statements for Kenton and Denton Universities, assuming that 13 students attend a course, and assuming that both universities charge executives a $347 tuition fee per course attended.

Answer 1

Answer:

Instructions are below.

Explanation:

Giving the following information:

Kenton:

Instructors= $6,100

Denton:

Instructors= $305 per student

A) Sellin price= $347

Kenton:

Sales= 347*20= 6,940

Fixed costs= (6,100)

Net operating income= 840

Denton:

Sales= 6,940

Variable costs= 20*305= (6,100)

Net operating income= 840

B) Sellin price= $227

Kenton:

Sales= 227*40= 9,080

Fixed costs= (6,100)

Net operating income= 2,980

C) Sellin price= $227

Denton:

Sales= 9,080

Variable costs= 40*305= (12,200)

Net operating income= (3,120)

D) Sellin price= $347

Kenton:

Sales= 347*13= 4,511

Fixed costs= (6,100)

Net operating income= (1,589)

Denton:

Sales= 4,511

Variable costs= 13*305= (3,965)

Net operating income= 546