MCM Entertainment is considering building a luxury hotel in Las Vegas. MCM anticipates that her 200...

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MCM Entertainment is considering building a luxury hotel in Las Vegas. MCM anticipates that her 200 rooms will rent for 66,000 room-nights per year. The market price for equivalent rooms is $210 per night. MCM estimates that the capital cost will be $13,650,000 and they expect an annual return of 15%. Following are the estimated annual operating costs: Variable operating costs Fixed costs: Salaries and benefits Facility maintenance a. Administration Total fixed costs Required: $ 145 per room night $750,000 160,000 510,000 $1,420,000 What is the full cost per room-night? b. Can MCM meet the targeted return on investment based on the estimated costs and revenue? Show your calculations. c. A tour operator has offered $100 per night for 40 rooms during a time of the year that there is likely to be at least that many rooms vacant. Should MCM accept this offer? Show your calculations. MCM Entertainment is considering building a luxury hotel in Las Vegas. MCM anticipates that her 200 rooms will rent for 66,000 room-nights per year. The market price for equivalent rooms is $210 per night. MCM estimates that the capital cost will be $13,650,000 and they expect an annual return of 15%. Following are the estimated annual operating costs: Variable operating costs Fixed costs: Salaries and benefits Facility maintenance a. Administration Total fixed costs Required: $ 145 per room night $750,000 160,000 510,000 $1,420,000 What is the full cost per room-night? b. Can MCM meet the targeted return on investment based on the estimated costs and revenue? Show your calculations. c. A tour operator has offered $100 per night for 40 rooms during a time of the year that there is likely to be at least that many rooms vacant. Should MCM accept this offer? Show your calculations.

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a What is the full cost per roomnight The full cost per roomnight is calculated as follows Variable ... View the full answer