# Question: Nice Place Preschool operates a not for profit morning preschool that operates

Nice Place Preschool operates a not-for-profit morning preschool that operates nine months of the year. Nice Place has 161 kids enrolled in its various programs. Nice Place’s primary expense is payroll. Teachers are paid a flat salary each of the nine months as follows:
Salary data
Teachers of two-day program: ................................................. \$ 438 per month
Teachers of three-day program:................................................ \$ 651 per month
Teachers of four-day program:................................................. \$ 872 per month
Teachers of five-day program:.................................................. \$1,040 per month
Preschool director’s salary:....................................................... \$1,250 per month
Nice Place has eight two-day program teachers, five three-day program teachers, seven four- day program teachers, and three five-day program teachers. Nice Place also has one director.
In addition to the salary expense, Nice Place must pay payroll taxes in the amount of 7.65% of salary expense. Nice Place leases its facilities from a local church, paying \$2,200 per month plus 10.75% of monthly tuition revenue. Fixed operating expenses (telephone, internet access, bookkeeping services, and so forth) amount to \$890 per month over the nine-month school year. Variable monthly expenses (over the nine-month school year) for art supplies and other miscellaneous supplies are \$10 per child. Revenue for the entire nine- month school year from tuition and registration fees is projected to be \$291,865.
Requirements
1. Prepare Nice Place Preschool’s monthly operating budget. Round all amounts to the nearest dollar.
2. Using your answer from Requirement 1, create Nice Place Preschool’s budgeted income statement for the entire nine-month school year. Assume that the operating revenue is \$291,865. You may group all operating expenses together.
3. Nice Place is a not-for-profit preschool. What might Nice Place do with its projected income for the year?

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