University Accounting for Decision-Making Assignment Solution

This document presents a comprehensive solution to an Accounting for Decision-Making assignment. The assignment analyzes a case study involving a hotel's occupancy rates and explores factors influencing them, such as room rates and tourism seasons. It also delves into ethical considerations within a business context, focusing on a scenario involving a family holiday package and its impact on decision-making. Furthermore, the solution includes calculations for break-even points, margin of safety, and profit analysis, incorporating variable and fixed costs. The document also discusses the advantages and limitations of employee codes of conduct and provides references to relevant academic literature.

Running head: ACCOUNTING FOR DECISION-MAKING
Accounting for Decision-Making
Name of the Student:
Name of the University:
Author’s Note:
Course ID:

1ACCOUNTING FOR DECISION-MAKING
Table of Contents
Part a:...............................................................................................................................................2
Answer 1:.........................................................................................................................................2
Answer 2:.........................................................................................................................................2
Part b:...............................................................................................................................................3
Answer 1:.........................................................................................................................................3
Answer 2:.........................................................................................................................................3
Part c:...............................................................................................................................................4
Answer a:.........................................................................................................................................4
Answer b:.........................................................................................................................................5
Answer c:.........................................................................................................................................5
Answer d:.........................................................................................................................................5
Answer a:.........................................................................................................................................6
References and Bibliographies:.......................................................................................................7

2ACCOUNTING FOR DECISION-MAKING
Part a:
Answer 1:
Particulars December January February
Occupancy rate of rooms 90% 95% 85%
No. of rooms 20 20 20
Room rate (Average) $ 180 $ 198 $ 198
Revenue of room (Budget) $ 3,240 $ 3,762 $ 3,366
Answer 2:
The overall evaluation of the case study mainly indicates that the demand for the services
of the company mainly declined from December to January. This was mainly due to the overall
increment in one rate that is depictured by Dorquay Hotel. Therefore, different factors directly
affect the occupancy rate of the organisation, which are tourism seasons, new adopted
subsystem, implementation of new rules, new client oriented programs, hotel booking rate or
price and brand image of the hotel. These identified factors could directly have a directly impact
on the overall occupancy rate of Dorquay Hotel. The overall decline in occupancy rate has
mainly fallen by 10% in January, as compared to the December occupancy rate. This mainly
indicates that the rising room rates have directly affected occupancy rate of Dorquay Hotel
(Hung, Shang & Wang, 2015).

3ACCOUNTING FOR DECISION-MAKING
Part b:
Answer 1:
The evaluation of the case study mainly indicates the overall unethical consideration,
which is identified from the action conducted by Anitah Loh. The family holiday package
provided by Anitah loh is mainly indicating unethical measures, which needs to be provided by
Mr Smith. Therefore, if relevant holiday package is taken by Mr Smith then it would directly
indicate a dishonest behaviour conducted by him. In addition, the unethical behaviour could
directly result in adoption of inherent risk, which could reduce ethical operational condition. The
relevant decision needs to be taken by Mr Smith regarding the selection of software and the use
of family holiday package could directly affect his decision making process. Therefore, the non
selection of family packages needs to be conducted by Mr. Smith as it might help in ethically
choosing the adequate software for his clients (Ford & Richardson, 2013).
Answer 2:
There are relevant advantages for using the overall employee’s code of conduct, which
are increment in regulatory compliance, increment in high ethical compliance, adoption of
standard code of conduct, increasing transparency in business and motivating the employee to
conduct adequate work. However, there is limitation of employee code of conduct, which
directly affects production of the organization. The mutation is that setting the code of conduct
would directly increase complexity of the business, increase formal regulatory could increase
cost of production, increases employee turnover, and destruct the balance scorecard of the
company (Lee et al., 2014).

4ACCOUNTING FOR DECISION-MAKING
Therefore, relevant measures that need to be taken in employee code of conduct mainly
indicates the employee need to strictly follow rules and regulations. In addition, the relevant
possible changes in liberation and policy clauses also need to be included in code of conduct.
Moreover, the measures also need to be conducted that relevant policies should be adopted,
which might help in increasing the overall productivity of the organisation. Furthermore, the
overall employee code mainly helps in outlining the overall attitudes and measure that needs to
be followed by employees in the organization (French, Guo & Shim, 2014).
Part c:
Answer a:
Particulars Units Amount
Per unit variable marketing and distribution costs $ 12.00 $ 420,000.00
Per unit variable manufacturing cost $ 28.00 $ 980,000.00
Per unit selling price $ 60.00 $ 2,100,000.00
Per unit contribution margin $ 20.00 $ 700,000.00
Fixed Costs:
Annual fixed non-manufacturing costs $ 370,000.00
Annual fixed manufacturing costs $ 120,000.00
Total fixed costs $ 490,000.00
Break-even point (in units) 24,500.00
Break-even (in sales) $ 1,470,000.00

5ACCOUNTING FOR DECISION-MAKING
Answer b:
Particulars Units
Annual volume (B) 35,000.00
Break-even (in units) (C) 24,500.00
Per unit selling price (A) $ 60.00
Margin of safety (in units) (D=B-C) 10,500.00
Margin of safety (in dollars) (E=A*D) $ 630,000.00
Answer c:
Particulars Units
Per unit contribution margin $ 20.00
Annual volume 32,000.00
Total fixed costs $ 490,000.00
Profit $ 150,000.00
Answer d:
Particulars Units
Per unit variable marketing and distribution costs $ 16.00
Per unit selling price $ 60.00
Per unit variable manufacturing cost $ 28.00
Contribution margin per unit $ 16.00
Annual fixed manufacturing costs $ 120,000.00

6ACCOUNTING FOR DECISION-MAKING
Annual fixed non-manufacturing costs $ 290,000.00
Total fixed costs $ 410,000.00
Units to be produced for achieving the same profit 35,000.00
Answer a:
The production unit of 35,000 could be conducted for adequately achieving the relevant
profit for 2016.