Energy Gel Key Assumptions - Joshua Metayer MGT340 Energy Gels A New Product Introduction KEY ASSUMPTIONS We assume the Energy Gel division will pay

Energy Gel Key Assumptions - Joshua Metayer MGT340 Energy...

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Joshua Metayer MGT340 Energy Gels: A New Product Introduction KEY ASSUMPTIONS We assume the Energy Gel division will pay their share of operational costs based on the percentage of units produced. This is calculated based on the overall percentage of energy gel units produced in direct comparison to the value of total units produced after the time assumption is articulated into the equation. Time Assumption: We assume the figure given in Exhibit 5 is the total number of units to be produced. Because the energy gel product takes half the production time in comparison to the energy bar, we multiply the given value by half. We assume the growth of Selling and G&A Expenses to grow in proportion to sales. For years 2006-2010 we assume a percentage of sales ratio of 3.6% for selling expenses and a percentage of sales ratio ranging from 7.9%-7.1% for general and administrative expenses. Both values were approximated by observing pro forma data as outlined in Exhibit 4.
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