MBA570 - Team Assignment - Contribution Income Analysis - 07-29-06

MBA570 - Team Assignment - Contribution Income Analysis - 07-29-06

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Exercising More than Just Your Body Contribution Income Analysis - Pro Forma 2006 Price Per Unit $23.67 Based on 2006 Sales Forecast Average Number of Units Sold 1,000 Total Sales $23,667 100% Less: Variable Production Costs, if any $- 0% Less: Variable Selling Costs $3,000 13% Total Variable Costs $3,000 13% $3.00 Per Unit Contribution Margin $20,667 87% Less: Fixed Production Costs, if any $- 0% Less: Fixed Selling and Administrative Costs $26,000 110% Total Fixed Costs $26,000 110% $26.00 Per Unit Income Before Taxes $(5,333) -23% $(5.33) Per Unit Break-Even Analysis Chart Break-Even Point (units) = 1,258 Break-Even Point ($'s) = $29,774 Total Fixed Costs TFC = $26,000 Formulas: Variable Cost per Unit VCU = $3.00 BEP (units) = TFC / (SPU - VCU) Sales Price per Unit SPU = $23.67 BEP ($'s) = BEP (units) * SPU 0 400 800 1200 1600 2000 2400 2800 3200 3600 4000 4400 4800 5200 5600 6000 6400 6800 7200 7600 8000 8400 8800 9200 9600 10000 10400 10800 11200 ($50,000)
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MBA570 - Team Assignment - Contribution Income Analysis - 07-29-06

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