Problem: Virginia State University (VSU) is preparing its master budget for the upcoming academic year. Currently, 12,000 students are enrolled on campus; however, the admissions office is forecasting a 5% 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:
- VSU is planning to award 150 tuition-free scholarships.
- The average class has 30 students, and the typical student takes 15 credit hours each semester.
- Each class is three credit hours.
- Each faculty member teaches five classes during the academic year.
Required:
Question 1: Compute the budgeted tuition revenue for the upcoming academic year.
Question 2: Determine the number of faculty members needed to cover classes.
Question 3: In preparing the university's master budget, should the administration begin with a forecast of students or a forecast of faculty members? Briefly explain.