This paper circulates around the core theme of Calculate the profit or loss in each of the 10 operas and the average profits for the whole season. together with its essential aspects. It has been reviewed and purchased by the majority of students thus, this paper is rated 4.8 out of 5 points by the students. In addition to this, the price of this paper commences from £ 99. To get this paper written from the scratch, order this assignment now. 100% confidential, 100% plagiarism-free.
The State Opera Theatre gains significant revenue from ticket sales
at each opera performed during the season. The sale of souvenir programs
for all performances of each opera also adds to profitability. Each
program costs $1.60 to produce and sells for $4.00. Any programs unsold
at the end of any opera are donated to a recycling centre and do not
produce any revenue.
Records of the programs sold for each opera show the following:
| Number of Programs sold |
Probability |
| 2500 |
0.15 |
| 2750 |
0.22 |
| 3000 |
0.24 |
| 3250 |
0.21 |
| 3500 |
0.18 |
(a) Your manager has asked you to determine the profitability of the
souvenir program production. You decide to use Excel to simulate the
sale of programs at 10 operas in a season together with the profit or
loss on programs for each opera. You decide to investigate the strategy
where the number of programs to be printed should be the number sold at
the previous opera. You will have to generate a dummy sale for a
“previous” opera to begin with. Include a calculation of the total
profit/loss for the season and the average profit/loss per opera.
Show the data and the model in two printouts: (1) the results, and
(2) the formulas. Both printouts must show row and column numbers and be
copied from Excel into Word. (You can do this using the Print Screen
command in Excel and then pasting (or CTRL+V) in the Word document. (6
marks)
(b) If the theatre management decided to print 3000 programs for each
opera calculate the profit or loss in each of the 10 operas and the
average profits for the whole season. You can do this using your
simulation model in (a) and adjusting where necessary to incorporate any
additional or different calculations. Which of the two production
strategies (the one in (a) or the one in (b) provides the higher profit
for the season and on average? (6 marks)
(c) Write a report to your manager advising
(1) the advantages and disadvantages of simulation models; and
(2) why a manager might be forced to use simulation instead of an analytical model in dealing with:
(i) an inventory ordering policy, and
(ii) bank teller windows
(8 marks)
QUESTION 3 Relevant Costs and Transfer Pricing 20 marks
