in contribution margin using the incremental analysis. Profit would remain unchanged if the change in fixed costs (advertising exp.) equals the change in contribution margin. 5-11 1. Breakeven point and sales sales 600k 40$/unit Variable expense 420k $28/unit CM 180k $12 Fixed expense 150k NOI $30k Fixed exp/ (cm/unit)= 150k/12= 12500 products Sales=12500*$40= $500,000 2. Total contribution margin is 150K at break-even point, which is equal to fixed expense
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description of product to be marketed and associated goals, such as sales figures and strategic goals 1|Page III. Situation Analysis a. Company Analysis Goals Focus Culture Strengths Weaknesses Market share b. Customer Analysis Number Type Value drivers Decision process Concentration of customer base for particular products c. Competitor Analysis Market position 2|Page Strengths Weaknesses Market shares d. Collaborators Subsidiaries/joint ventures and distributors
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Chapter 8 Summary: Location Strategies Team #: 3 Team Members: Daniel Coughlin Joel Nemr Jennifer Ogle Operations Fundamentals Prof. Riaz Khan 63.501.201 Date: 04/11/2012 Location Strategies Strategic Importance of Location Overview As markets continually expand, the location of a business becomes increasingly important. Location choice can provide a company with distinct advantages. The ideal location should provide an overall maximum benefit to the company, factors considered
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Analyzing Financial Statements Financial analysis is necessary in any human service agency as it allows it to get a clear picture of the financial standings for the fiscal year. According to Martin (2001), “financial analysis is defined as the process of using information from financial statements to calculate financial ratios that assess the financial standings of human service agencies.” There are six formulas used when conducting the financial analysis: long-term solvency ratio, contribution ratio
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Executive Summary INTRODUCTION The number of movie theaters is decreasing as the major chains create multiplexes that pile more people into smaller spaces. This profit strategy has left once popular downtown theaters vacant. Second Run Pizza is a theater/restaurant business that believes there is a significant number of theater-goers that are craving a more satisfying and enjoyable way to catch a movie and a bit to eat. Second Run Pizza is renovating the downtown City plus Theater and creating
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a goal to make 30 percent margin and expand their business in New York-New Jersey area. Hence, he asked us to review their product line and costing information then give suggestions to increase profit and make a price list for the Albany area. Analysis: We completed the calculations finding variable costs per thousand bottles for a number of combinations. Table #1 summarizes the variable costs for the Albany area, which includes scrap. Table #2 summarizes the variable costs for the New York
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they discovered the meat pies, the national snack food of Australia and interested in starting up a business in U.S to produce and sell similar meat pies, The couple has decided to apply for a loan through a contact to establish a new business. Even though bank has tentatively agreed to provide the loan up to one million with 6% interest per year, still loan committee of the bank require business plan including complete set of projected financial statements for the first year of operations, including
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average 205 hours per week, what level of commercial sales of computer use would be necessary to break even each month? Given this analysis, is the subsidiary really a problem to Prestige? Solution Based on the breakeven analysis the subsidiary is a problem to Prestige. They are currently operating at an average demand of 205 hours per month. They need to operate at 1116.19 hours in order to break even. The additional, unexpected costs incurred along with the difficulty in finding customers have
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Long-term Interest Rate 5.00% 5.00% 5.00% Tax Rate 15.00% 15.00% 15.00% Other 0 0 0 7.2 Break-even Analysis The Break-even Analysis indicates that approximately $20,000 is needed in monthly revenue to reach the break-even point. Break-even Analysis Monthly Revenue Break-even $20,000 Assumptions: Average Percent Variable Cost 15% Estimated Monthly Fixed Cost $4000 7.3 Projected Profit and Loss We estimate
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Chapters 3 & 4 01. How will the contribution margin and the break-even point change as a result of a change in the selling price, variable costs, or fixed costs? 02. Which of the following variables will not have an impact on a company’s break-even point? Change in variable costs, sale price, number of units sold, or fixed costs? 03. What factors would cause the margin of safety to decrease? A change in fixed costs, total revenue, break-even point, or variable costs? 04. What is the breakeven point
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