Middlehurst House Executive Summary

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TO: Mr. Bill Compton, Owner Mr. George Friedman, Owner, Director FROM: Sandra Rhames-Smith, Accounting Department DATE: December 14, 2015 SUBJECT: Suggested Changes Analysis to Middlehurst House Operations In answer to your request for an examination of your proposed changes to the Middlehurst House Daycare Operations which include class size, and tuition fees changes. In the analysis you will find the executed calculations of the cost-effectiveness of these changes in the following four areas: A. The reduction of the number of students per class while preserving the current profit levels. B. The potential profitability of making a new class based on the waiting list. C. The profitability of a new tuition rates linked with the reduction of student per class, along with new classes created and filled using the current waiting list. D.…show more content…
Will creating a class for infant care be profitable for the company? CURRENT DATA: (Exhibit 2) Middlehurst House Daycare, currently have a total of six classes with approximately 80 students. The children are divided into age groups of two to three years, three to four years, four to five years and five to six years of age. The age group two to three has a total of 20 children, 15 the age group of three to four, 15 in the age group of four to five, and finally 30 in the age group of five to six. The combined total for all group equals a total of 80 children. BREAKDOWN OF THE FOUR RESEARCH

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