Albany County provides a county-wide van service for senior citizens. The County receives a $100,000 grant each year from a consortium of local organizations in support of the van service

The County expects to spend $2,500 each year to pay for copying and the supplies needed to operate the service. Insurance will cost the County $1,750 per year for each of the two vans that it operates.

The County employs a supervisor to run the van service. There are also six part-time coordinators that organize the routing of the vans and provide outreach to the senior community. Each coordinator works an average of 17 hours per week for 50 weeks in the year.

Salary and Wage Schedule (including benefits)
Supervisor $36,000 per year
Coordinator $10 per hour

All drivers are volunteers. The costs associated with carrying each passenger are $0.35 per mile. The average ride for each passenger is 5 miles. Seniors are asked to pay $0.75 for each ride, but only 80% of the riders are able to afford the donation.

Prepare an operating budget for the upcoming year, assuming 5,000 seniors use the van service during the year. In the past, there have been fluctuations in ridership so the County would also like to see what would happen should there be a 10% increase or decrease in the number of rides.

Revenue 10% Decrease 5000 10% Increase
Grant $100,000 $100,000 $100,000
Fares (V*.8*.75) 2,700 3,000 3,300
$102,700 $103,000 $103,300
Expenses
Supervisor $36,000 $36,000 $36,000
Coordinators (6*17*10*50) 51,000 51,000 51,000
Insurance (1750*2) 3,500 3,500 3,500
Supplies/copying 2,500 2,500 2,500
Mileage (V*.35*5) 7,875 8,750 9,625
$100,875 $101,750 $102,625
Surplus/(Deficit) $1,825 $ 1,250 $675