Question Content Area Integrative Exercise Relevant Analysis, Cost-Based Pricing, Cost Behavior, and Net Present Value Analysis for Superior Stay Resorts Special-Order Offer Relevant Analysis Superior Stay Resorts provides luxurious hotel accommodations to its high-end customer base. Superior measures business volume by the total number of occupied guest room nights during the year. For each of the past several years, Superior's sales have been considerably less than the expected annual volume of 1,200,000 total guest room nights. Therefore, the company ends each year with significant unused capacity. Given its high-fixed cost structure, Superior's profitability hinges on increasing the number of occupied guest room nights (i.e., decreasing unused capacity

2. Create a spreadsheet that contains the model inputs you included in your completed table (from Requirement 1). Using your spreadsheet.

a. Calculate the relevant revenues associated with the special-order offer.

b. Calculate the relevant costs associated with the special-order offer.

c. Select your model (from Requirement 1c) and calculate the relevant increase or decrease in profit associated with the special-order offer (Enter loss, if any, as a negative amount).

6. Create a spreadsheet that contains the model inputs you included in your completed table (from Requirement 5). Using your spreadsheet and Superior's 40% markup pricing method for Barnyard's special-order offer, create a model that calculates the unit guest room price that Superior should charge Barnyard to rent each guest room if it sets the special-order sales price by using its markup pricing method. (Hint: Refer to the relevant costs that you calculated in response to Requirement 2b.)

7. Now create another model that calculates the relevant increase or decrease in profit associated with the special-order offer.

9. Assume that Superior pays for all costs with cash. Also, assume that a 10% discount rate, a 5-year time horizon, and all cash flows occur at the end of the year. Using an NPV approach to discount future cash flows to present value

a. Create a model that calculates the NPV of accepting the special-order offer with the assumed positive relevant profit of $500,000 per year (i.e., the special-order offer alternative).

b. Create a model that calculates the NPV of downsizing capacity as previously described (i.e., the downsizing alternative).