Budgeting | Case Studies | Assignment

Running head: BUDGETING
Budgeting
Name of the Student
Name of the University
Author Note

BUDGETING
Table of Contents
Case 9-45....................................................................................................................................2
Requirement 1:...........................................................................................................................2
Requirement 2:...........................................................................................................................3
Requirement 3:...........................................................................................................................4
Case 9-46....................................................................................................................................5
Requirement 1:...........................................................................................................................5
Requirement 2:...........................................................................................................................6
References list:...........................................................................................................................9

BUDGETING
Case 9-45
Requirement 1:
Owing to the Racquet Club’s adoption of new membership plan and the renewed
structure of the fees so as to improve its capability to plan the cash receipts, it can be said that
cash receipt is a special accounting method where the account for cash or credit sales is
received and analyzed. Adoption of the two most primary factors which affect the cash
receipt in the city Racquet Club, these are:-
Annual membership fees and Hourly court fees – These fees are more direct and fixed
in nature and is collected annually. So, it can be said that the annual fees are the constant and
fixed factors, whereas in case of hourly court fees their fixed price per unit varies from $6 to
$10 and the transaction carried out on everyday basis. The total price varies the hourly court
fees which are found to be dependent upon factors such as the number of hours spent in the
club, the total number of customers, the season of the year and the time of the year
independent of the prime or the non-prime timing of the year. Consequently, it can said that
the hourly court fees are not fixed and are not predictable, covering a larger portion of the
area of cash receipts in comparison to the annual membership fees. By the implementation of
the newer membership plan in the City Racquetball Club, better stability in terms of planning
the cash receipts will be brought about. It is because the hourly court fees taken out, only the
annual membership fees are left to be charged signifying that factors affecting the cash
receipts are reduced on a large scale. However the annual membership fees being fixed and
constant thereby resulting in lesser and predictable cash flows. Moreover, the possibility of
loss of daily cash from hourly court is also eradicated by the implementation of the newer
membership plan (Chohan & Jacobs, 2018). So, it can be said that with this there will better

BUDGETING
cash flow and this will also draft out future financial plans like shortage of cash will be more
effective. However this will not affect the overall profit of City Racquetball club.
Requirement 2:
a. There are some primary factors which the CRC must take into account during the
evaluation and adoption of the new membership plan and fee structure completely. One of the
most significant factor is on how the existing or new customers would react to the price
changes which might give rise to another factor like the loss or gain to the company. As the
newer membership structure is already taking in the risks of losing its customers, as because
the customers on paying a higher annual membership fees might compare with the
competitors of the City Racquet Ball club. Therefore the club must provide more benefits in
comparison to their competitors.
Another most important factor is the overall cost during the implementation of the
new membership plan this process of changeover must be properly evaluated. Proper
planning must be done prior evaluation so that there is no unreasonable hike in the price. In
order to achieve a lean changeover the City Racquetball Club must reduce the cost to a
certain extent. While the implementation of the new fee structure the club must consider key
factors such as extra frontline training on new prices, customer handling, new packages and
other possible queries arising among the customers. The staff must be proactive and notify
their customers about every detailed changes brought about in their club and all the
information regarding the briefed over the renewed implementations as producing accounts
for end of year checks with new prices and packages can be perplexing. Another important
factor in analyzing is if the implementation will result in earn or loss. The major inflow of
cash of this club is from the consumers purchasing the hourly court fees and the annual
membership fees. This analysis of these factors shall help in including how the new