1) GENUINE MOTOR PRODUCTS Revised Pro forma Income Statement For 2007 Sales (1‚000‚000 units @ $30 per unit) Fixed costs Total variable costs (1‚000‚000 units @ $18.80 per unit) Operating Income (EBIT) Interest (10.75% x $12‚000‚000) Earnings before taxes Taxes (35%) Earnings after taxes Shares Earnings per share * Fixed costs include $2‚800‚000 in depreciation $ 30‚000‚000 5‚800‚000 18‚800‚000 5‚400‚000 1‚290‚000 4‚110‚000 1‚438‚500 2‚671‚500 2‚320‚000 1.15 $ $ $ 2) Although there is more
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What is the breakeven point? Q5: What assumptions and limitations should managers consider when using CVP analysis? Q6: How are the margin of safety and operating leverage used to assess operational risk? Chapter 3: Cost-Volume-Profit Analysis Eldenburg & Wolcott’s Cost Management‚ 1e Slide # 2 © John Wiley & Sons‚ 2005 Q1‚ Q4: CVP Analysis and the Breakeven Point • CVP analysis looks at the relationship between selling prices‚ sales volumes‚ costs‚ and profits. • The breakeven point (BEP) is
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A budget is how a business manages their money by predicting the amount the company is going to spend. The two types of budgeting our: * Zero budgeting – Urban Fashion will not know how much items is going to cost as the board of directors would not give them a specific amount to spend * Allocated budgeting – Urban Fashion know how much the budget is that they would have to pay things. In economics‚ fixed costs are business expenses that are not dependent on the level of goods or services
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3.2 explain the calculation of unit costs and make pricing decisions using relevant information Pricing is depend on the unit costs‚ consumer capability and the breakeven analysis‚ To perform the breakeven analysis and to calculate the unit cost ‚we should consider about the two relevant costs. Those are fixed costs and variable costs. Fixed costs – Costs that will not change with in a period of time . ex- Machineries‚ Insurance. These are the essential costs that should be considered at the
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Generation-X What is Generation-X .the post-baby-boomer’ generation. Generation-X is the word that stands for the children of the baby boomer generation in America. It has been coined as such because of the diversity and lack of homogeneity of this population‚ which stands in sharp contrast with the baby- boomer generation. X stands for the unknown‚ unpredictable variable. .the 52 million Americans born between 1965 and 1981. Technically‚ Generation X is classified as
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Abstract Wakeboarding and snowboarding locations * Red Bull Art of Motion * Freerunning competition * Red Bull Stratos * Felix Baumgartner’s record breaking jump from 128‚000 feet * Travis Rice’s: The Art of Flight * Snowboard documentary funded by Red Bull This list goes on. Just by these few examples there’s no question that Red Bull has developed a world famous brand personality‚ for being the leader in sports innovations. They have continually pushed the envelope
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Gillette Safety Razor Division: Case Write Up Overview Ralph Bingham‚ VP new business development of Gillette Safety Razor Division (SRD) needs to decide whether to enter the rapidly growing blank recording cassette market. He is assessing whether Gillette can use its strengths in high volume manufacturing and marketing of mass distributed packaged goods to assume a leadership position in this new market. I recommend Gillette avoids entering this market Analysis The SRD commissioned consultancy
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production and sales are: 2‚000‚ 4‚000‚ and 1‚000 cases of 4‚ 8‚ and 12 ounce bottles‚ construct of lotion bundle to consist of 2 cases of 4 ounce bottles‚ 4 cases of 8 ounce bottles‚ and 1 case of 12 ounce bottles. The following table calculates the breakeven number of lotion bundles to break even and
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________ to school. (to lose) (to walk) Answer: I lost my keys while I was walking to school. 1) While I ____________‚ the school bus _____________. (to text) (to arrive) 2) Cindy ____________ her leg while she _____________. (to break) (to snowboard) 3) He __________ to the radio while he ____________breakfast. (to listen) (to prepare) 4) My father _________ at 70 km/h when a policeman ________ him. (to drive) (to stop) 5) The girl _________ that the boy __________ her. (to notice)
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selling price $366 per ounce exceeds the average variable cost $246 per ounce. The average variable cost here is referring to the average cash cost. (C) Assuming the average cash cost is the average variable cost‚ both the short-run and long-run breakeven prices at Karlgoolie are much lower than the Bulyanhulu.
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