Anya ,'Get It Done'
Off-topic discussion. Wanna talk about corsets, duct tape, or physics? This is the place. Detailed discussion of any current-season TV must be whitefonted.
I just don't necessarily agree that the "overhead" should be that high. Our overhead rate at the University is 52 percent.
Right, so the cost of putting on the class is Instructor Salary + Overhead, and overhead rate is 52% so that's Salary + 0.52 Salary is approximately 1.5xSalary. It may not be actually correct, but it lines up with University accounting.
Breakeven calculations are usually just approximations, Sophia, sort of a rule of thumb for making quick decisions for the future, not real analysis of what costs/profits have actually been.
Thank you! That makes sense. I am not sure the associate dean gets this because she is always saying we aren't making any money based on this calculation, but when you subtract our expenses and overhead from the income, we always show a positive number.
You know, I don't know why this is so confusing to me. I mean, it makes a lot more sense now, but why do we scrimp and save and not pay for things for the students, when we could spend .5 times the instructors salary. And what does the instructor's salary have to do with how much the overhead is? Aaargh. Oh well.
Hooray, something I learned in business school was useful to someone!
Yes, thank you -t! I am such a dummy about this-- and my former boss was too!
Amy - if it gets there, please let us know the where, when and what of the TV show. I will totally watch it.
I met Sheryl and her DH last night! They came to my show and enjoyed themselves, verily. Several of my castmates spoke well of them.
And what does the instructor's salary have to do with how much the overhead is?
I expect this is a rule-of-thumb thing based on the historic costs of classes. They may have found that the total cost of all classes averaged 1.5 times the total cost for instructors. If this was consistent for several years, it's a useful rule of thumb even though it might not apply to every instructor and every class.
And what does the instructor's salary have to do with how much the overhead is? Aaargh. Oh well.
It's an average -- overall, the U. knows it spends X on salaries and .5X on overhead (apparently -- in my experience, overhead is calculated on everything, not just salaries, but I'll go with it). So instead of figuring the exact specifics each time (flyers, IT, whatever), you just use the 52% every time, and it works out over the year.