Alba Holidays Limited, based in the west of Scotland, is relocating its business as an agency for packaged holidays for other holiday providers to a full-fledged corporate having its own aircraft and holiday studios. Alba is set to acquire on lease its own aircraft, a second-hand 160 seat plane.
The rest of the week, the plane will fly holiday passengers to lower priced holiday packages under the brand name of Prestair.
There is no mention about how many flights Alba plans to operate on daily basis. However, there is the mention that the plane will take 1.5 hours to cover the 600 miles distance to Balerica. This means the plane will take 2 hours to cover the average 800 miles daily the rest of the week days. A return trip to these locations obvious will double the mileage and time to 3 hours and 4 hours respectively for Balerica and other destinations. Assuming the plane is rested 6 hours during the day of the week when it is flown to Balerica and 5 hours during each week day when it is flown to other lower priced holiday packages destinations, it is capable of making maximum 6 trips a week on the same day to Balerica and 5 trips daily to other destinations rest of the week.
The plane expects to have 90% occupancy annually. This means it will have approximately 144 passengers on each flight. This translates to maximum 864 passengers (144 x 6) weekly to Balerica and 4320 passengers (144 x 5 x 6) during the rest of the week to other holiday destinations. Thus, the total number of passengers for Balerica and other holiday destinations work out to 5184 (864 + 4320) every week. ...
other lower priced holiday packages destinations, it is capable of making maximum 6 trips a week on the same day to Balerica and 5 trips daily to other destinations rest of the week.
The plane expects to have 90% occupancy annually. This means it will have approximately 144 passengers on each flight. This translates to maximum 864 passengers (144 x 6) weekly to Balerica and 4320 passengers (144 x 5 x 6) during the rest of the week to other holiday destinations. Thus, the total number of passengers for Balerica and other holiday destinations work out to 5184 (864 + 4320) every week. The industry average prices for equivalent brands are 380 for Balerica, and 300 for other holiday destinations.
Details regarding costing, finance and administration are given as follows.
Full Costing of One Week Sunbronzer Holiday in a Studio in Balerica
The figures available in the instructions have been used to arrive at the full costing. However, there are other costs that have not been mentioned in the instructions and hence have been included. These are the costs of advertisements, additional manpower in the form of tour guides, drivers, etc, which serve as the unique sales points (USO) in the holidays' business.
As per information available in the instructions, the following expenses have been included to arrive at the full costing figure:
One Week's Costing (Sunbronzer)
Hangar fees (100,000 x 52/357) 14,566
Aircraft Servicing @ 2 per air mile travelled (600 x 2 x 2) 2,400
Fuel (600 x 8 x 2) 9,600
Aircraft Cabin Maintenance (600 x 0.40 x 2) 480
Depreciation - Land & Building (480,000/ 7) 68,571
Depreciation - Furniture & Fixtures (320,000) 45,714
Allowances for Breakages 200
Gardening, Maintenance & Maid ...
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