Essay on Border Hotel Case Calculations

1310 Words Jun 1st, 2014 6 Pages
Revenue Estimates
Revenue Item 100% Monthly 75% Monthly 50% Monthly Notes
Rooms $2,956,500 $2,217,375 $1,478,250 8,100 daily
Leases $180,000 $135,000 $90,000
TOTAL REVENUE $3,136,500 $2,352,375 $1,568,250

Expences
TOTAL VARIABLE COSTS $454,000 $340,500 $227,000
TOTAL FIXED COSTS $1,403,000 $1,403,001 $1,403,002
TOTAL EXPENSE BEFORE IT $1,857,000 $1,743,501 $1,630,002
EBIT $1,279,500 $608,874 -$61,752 Depreciation $320,000 $320,001 $320,002
EBITDA $1,599,500 $928,875 $258,250 Furnishing Interest $110,000 $110,000 $110,000
20yr Mortgage Interest $182,000 $182,000 $182,000
TOTAL INTEREST $292,000 $292,000 $292,000 TAXES (40%) $395,000.00 $126,749.60 -$141,500.80
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58,250 Furnishing Interest $110,000 $110,000 $110,000 TOTAL INTEREST $110,000 $110,000 $110,000 TAXES (40%) $467,800.00 $199,549.60 -$68,700.80 Furnishing Principal $180,160 $180,160 $180,160
20yr Mortgage Principal $49,713 $49,713 $49,713
TOTAL PRINCIPAL $229,873 $229,873 $229,873
NET INCOME $471,827 $69,451 -$332,924
DIVIDEND PAYMENT $37,746 $5,556 -$26,634 RETAINED EARNINGS $434,081 $63,895

EBIT/INTEREST 11.63 5.54 (0.56)
EBITDA/INTEREST 14.54 8.44 2.35
BURDEN $493,121.67 $493,121.67 $493,121.67
EBIT/BURDEN 2.59 1.23 (0.13)
EBITDA/BURDEN 3.24 1.88 0.52
ROE= Net Income/OE (H2) 13.48% 1.98% -9.51%
ROE= Net Income/OE (H3) 27.75% 4.09% -19.58%
ASSET Proposal1 Proposal2 Proposal3 Cash $0 $0 $0 Land $975,000 $975,000 $975,000 Building $2,300,000 $2,300,000 $2,300,000 Furnishing $1,100,000 $1,100,000 $1,100,000 Organization Cost $50,000 $50,000 $50,000 Incorporation Exp $50,000 $50,000 $50,000 Securities: Legal and other $0 $125,000 $125,000 TOTAL ASSET $4,475,000 $4,600,000 $4,600,000 LIABILITIES Business Loan $1,100,000 $1,100,000 $1,100,000 Mortgage $2,275,000 $0 $0 $0 $0 $0 TOTAL LIABILITIES $3,375,000 $1,100,000 $1,100,000

EQUITY Starting Common Equity $1,100,000 $1,100,000 $1,100,000 Extra equity $0 $2,400,000 $600,000 Total Common Equity $1,100,000 $3,500,000 $1,700,000 Preferred Equity $0 $0 $1,800,000 Total

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