Indirect costs @ 25% of $3‚675.00 $ 906.00 Subtotal $4‚529.00 8. Profit margin @ 5% of $4‚594.00 $ 227.00 Total $4‚756.00 Fixed Cost Conference room rental $175.00 Audiovisual equipment rental $75.00 4 Presenters @ $500.00 $2‚000 Indirect Cost @25% of $3‚675 $906.00 Profit Margin @5% of $4‚594 $227.00 Total Fixed Cost $3‚383.00 Variable Cost 45 Workbooks @ $15.00 $675.00 45 Lunches @ $12.00 $540.00 45 Coffees @ $3.50 $157.50 Total Variable Cost $1372.50 My
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financial results if a specified level of activity or volume fluctuates. This information is vital to management‚ as one of the most important variables influencing total sales revenue‚ total costs and profits is output or volume. Break-Even Analysis is based on the relationship between sales revenue‚ costs and profit in the short run. The short run being a period in which the output of the firm is restricted to that available from current operating capacity. In the short run‚ some inputs can be
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Appendix 2. a) Parking‚ Concession‚ Merchandise cost includes both fixed and variable costs. Variable Costs = | 10% * Revenue | | | Fixed Costs = | Total expense - | Variable Cost | | | | | | Costs | Variable | Fixed | Total Cost | Parking expense | 19‚767 * 10% = | 4‚448 - 1‚976.70 = | | | $ 1‚976.70 | $ 2‚471.30 | $ 4‚448.00 | Concession expense | 79‚273* 10% = | 43‚356 - 7‚927.30 = | | | $
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Case Study #1. Salem Telephone Company 1. Variable expenses: Power (the more hours sold‚ the more energy consumed) The hourly personnel (operations) works only when the computers are in operation Fixed expenses: The rent has to be paid despite any level of production ($8‚000 monthly) The custodial services depend on Salem Telephone’s estimated space‚ they are independent from the revenue of the Company The computer leases were acquired to run the business (before it was actually started
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calculate costs associated with running a production facility. Furthermore‚ the analysis will be used to provide a basic understanding of how changes in staffing and productivity impact profit and loss. Management’s Production Decision Introduction This report will provide insight on what your management team should do concerning production costs. We will examine 2 different scenarios and provide our decision as to which makes most sense. In the first scenario‚ the total fixed cost of the production
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the key elements of the break-even analysis will be discussed. The key elements of break-even analysis are fixed cost‚ variable cost‚ total revenue‚ break-even point and margin of safety. Although break-even analysis is very useful‚ it has disadvantages. Break-even analysis is based on the production cost of the company which includes the fixed cost and variable cost. Then the total cost of the production is compared with the total sales revenue to find out the breakeven point. The break even analysis
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a variable cost is a cost that varies‚ in total‚ in direct proportion while a fixed cost remains unchanged‚ in total‚ regardless of any change. ->Examples of fixed and variable costs in respect to small changes in the measure of selling CDs: Cost | Cost behavior | | Variable | Fixed | The cost of advertising new store | | X | Number of CDs supplied | X | | The cost of renting space for store | | X | The electrical cost in store | | X | The direct labor cost | | X | The
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service. 2. Total Fixed Costs: The sum of all costs required to produce the first unit of a product. This amount does not vary as production increases or decreases‚ until new capital expenditures are needed. Fixed Costs: Fixed costs are those business costs that are not directly related to the level of production or output. In other words‚ even if the business has a zero output or high output‚ the level of fixed costs will remain broadly the same. In the long term fixed costs can alter - perhaps
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1 a. CD Contribution Profit Selling Price to CD Distributor Less: Variable Cost $9.00 $1.25 $0.35 $1.00 $2.60 CD Package and disk Songwriter’s royalties Recording artists’ royalties Total Variable Cost Contribution per CD unit $6.40 Chapter 2 Problem 1 b. Break-Even Analysis – Units and Dollars Total Fixed Cost Advertising and Promotion $275‚000 Studio Recording’s Overhead $250‚000 Total Fixed Cost $525‚000 BEVU = $525‚000 / $6.40 = 82‚031.25 units BEV $ = 82‚031.25 units
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Keeping activities on track‚ are they being met‚ how to get back on track Types of Costs Product- all costs to purchase or manufacture Merchandiser: all costs for getting goods ready to sell Manufacturer: same as above + direct materials‚ direct labor‚ mnf. Overhead Period costs- arise from the passage of time‚ expensed as incurred ex. Salaries outside of product manufacturing. Manufacturing costs Direct or raw materials‚ indirect materials: denim vs. thread in making jeans Direct
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