Question

Western State University (WSU) is preparing its master budget for the upcoming academic year. Currently, 14,000 students are enrolled on campus; however, the admissions office is forecasting a 8 percent growth in the student body despite a tuition hike to $80 per credit hour. The following additional information has been gathered from an examination of university records and conversations with university officials:

•WSU is planning to award 150 tuition-free scholarships.

•The average class has 35 students, and the typical student takes 20 credit hours each semester. Each class is four credit hours.

•WSU’s faculty members are evaluated on the basis of teaching, research, and university and community service. Each faculty member teaches five classes during the academic year.

Required:

1.Prepare a tuition revenue budget for the upcoming academic year.

2.Determine the number of faculty members needed to cover classes.

3.Assume there is a shortage of full-time faculty members. Select at least five actions that WSU might take to accommodate the growing student body by selecting an "X" next to the action.

4.You have been requested by the university’s administrative vice president (AVP) to construct budgets for other areas of operation (e.g., the library, grounds, dormitories, and maintenance). The AVP noted: “The most important resource of the university is its faculty. Now that you know the number of faculty needed, you can prepare the other budgets. Faculty members are indeed the key driver—without them we don’t operate.” Are faculty members a key driver in preparing budgets?

Prepare a tuition revenue budget for the upcoming academic year.

	Tuition revenue budget: Total student body 0 Tuition-paying students 0 Total credit hours 0

Determine the number of faculty members needed to cover classes.

	Faculty needed

Assume there is a shortage of full-time faculty members. Select at least five actions that WSU might take to accommodate the growing student body by selecting an "X" next to the action.

	Hire part-time instructors Use graduate teaching assistants Increase the teaching load for each professor Reduce the number of courses offered. Increase class size and reduce the number of sections to be offered Have students take an Internet-based course offered by another university Shift courses to a summer session

You have been requested by the university’s administrative vice president (AVP) to construct budgets for other areas of operation (e.g., the library, grounds, dormitories, and maintenance). The AVP noted: “The most important resource of the university is its faculty. Now that you know the number of faculty needed, you can prepare the other budgets. Faculty members are indeed the key driver—without them we don’t operate.” Are faculty members a key driver in preparing budgets?

	Yes No

Answer 1

Answer 1.
Total Students - 14,000 Students X 108%	15,120
Less: Tution Fees Scholarship	150
Revenue Generating Students	14,970
Credit Hours per Year	20
Total Credit Hours - 14,970 X 20 hrs	299,400
Tution Rate per Hour	80.00
Budgeted Tution Revenue	23,952,000.00
Answer 2.
Number of Students	15,120
No. of Classes per Student per Year	10
Projected Stusdents Enrollment	151,200
Average Number of students	35
Classes to be taught/academic year	4,320
Classes taught/professor	5
Faculty Needed	864
Answer 3.
1. Hire part-time instructors
2. Use graduate teaching assistants
3. Increase the teaching load for each professor
4. Increase class size and reduce the number of sections to be offered
5. Shift courses to a summer session
Answer 4.
No.
The number of students and the resultant tuition revenue are really the key drivers.