Chester & Wayne Economic Material Cash Budget
Introduction
After reading this spreadsheet budget of Chester & Wayne food distribution company. Since the CEO, Mr. Chester, asked this writer to help prepare cash-flow material from temporary control expanse from Sept. 30 for the last three months of this 12 months. Chosen costs:
Paper money $142,100
Balance sheet to paid $354,155
In demand self-assurances 200,000 former money used 53,200 profit & loss account receivable $1,012,500 stockpiles 150,388
Genuine scheduled deals figures is as follows:
Existing: Costs:
Aug.$750,000
Oct. $826,800
Sept.787,500
Nov. 868,200
Dec. 911,600
Jan. 930,000
Budget Plan
1. Show how to Organize a currency, financial plan in a single month of the twenty-five percent part and for the area in inclusive, come up with accompanying plans when necessary (Ashford assignment 4, 2016).
2. a. Mr. Wayne has an idea that the gross margin may reduc to 27.5 % over the greater earning cost (Ashford assignment, 2016).
…show more content…
Regardless of its modest design, one can crude perimeter can, in fact, be the breaking point of any beginning. In that case, gross margin symbolizes an establishment’s profits; meanwhile, this only accounts for the budget of manufacturing supplies or amenities for sale. Fundamental limits merely industry’s returns, lack the costs openly fixed by making of goods. It is important to realize that Complete disbursement is frequently changeable charges, showing the expenses for overhead, which entirely coupled to the sum of the pieces manufactured (November 23,
• Net profit margin has been negative and no major patterns over the 9 year period on net profit since the trend of the industry is based mostly on economic factors, and whether or not they secure contracts. Due to high percentage of COGS they are only left with a net profit of $980 or
8.20 equals $ 86,700. The contribution margin per unit at a retail price of Cr. 6.85 equal 1.95. The required volume will be the result of dividing the profit impact on the contribution margin per unit.
Gross margins for 1994, 1995, 1996 and 1997 were 53.9%, 49%, 52.63% and 55.5%, respectively. Be Our Guest, Inc. is doing a solid job of keeping the Costs of Revenue in line with the Sales Revenue. It is a positive sign to see this growth, because we can be assured that the company is staying competitive, while not completely giving in to the pricing crunch. Annual Sales Revenue has a strong CAGR, but it is important and concerning to note that the CAGR of total Operating Expenses is higher. It is about 5% higher and this is very important, because Be Our Guest needs to stay in control of its expenses.
13. If the selling price is $22 per unit, what is the contribution margin per unit sold?
While we are performing our analysis on different aspects of the company, we look at the three main types of cost. When we remain devoted to improving our costs, and the faults related, we show our same devotion to our consumers. This is portrayed by the quality of products we put on the shelves. Prevention costs, appraisal costs and Failure costs are areas
Submit report with CRA matrix to Assignment Minder. Note that you need to attach the Assignment Minder ‘assignment cover sheet’ to the front of the document wallet.
* If we surmise that the company’s specialist’s predictions of 4% on market growth along with renewing current and or adding more customer contracts then the profits should be as follows:
Contribution Margin = (Unit selling price – unit variable cost) / unit selling price = ($9.00 – $2.60) / $9.00 = 0.7111 = 71.111%
The Gross Margin ratio represents the percent of total sales revenue that TCI retains after incurring the direct costs associated with producing the goods and services sold by them. It helps us distinguish, as much as possible, between fixed and variable costs. With a 20%, 15%, or 10% projected increase in sales, for 1996, we calculated TCI’s GM ratio to be 41.85% , and in 1997 to be 41.84%. This means that around 42% of TCI’s sales dollar is available to pay for fixed costs, like its potential long-term debt to MidBank, and to add to profits.
We assume that Net fixed assets as percentage of sales will eventually become constant at 1%, and revenue growth rate will eventually become constant at 6%, thus the assumed profit margin will also eventually become constant. It is reasonable to assume that at the beginning the profit margin increases because Crocs enjoys economics of scale and direct sales
If Jones-Blair cut prices by 20%, they would need to maintain the profit of $1.14M to keep the status quo. The contribution margin right now is 35%, if the prices were cut by 20%, the contribution margin decreases to 15%. 35% is converted into .35 and 20% is converted into .20. The required sales in order to maintain the status quo if prices were reduced by 20% is 28M. This is found by finding the gross margin which is current sales multiplied by the contribution margin, 12M * .35 = 4.2M. We would then need to maintain the same gross margin to find out the required sales, (12M + x) * .15 = 4.2M. Computation equates x to be $16M. The $16M that is required to maintain the same gross margin, added to the $12M of the current sales equals $28M. In order to maintain the current profit, Jones-Blair would have to increase sales by $16M, more than double the current amount. If chosen, this alternative would be a very poor choice.
Referring to Vice President of Finance, he want to pursue the current approach because they are in profitable based on contribution margin by 35 percent. The company just needs to monitor their margin in control their cost well.
The Gross profit margin stays relatively constant at around 36 %. However, there is a slight rise from 2000 to 2004.
Let’s say Arrow corporate with Express, the gross total margins would decrease from 16.29% to 15.5% in optimistic scenario, and to 14% in pessimistic scenario (Exhibit 1). With expenses currently at 11%, a 22.5% decrease in Arrow’s operating profits would occur, which Express would have a difficult time making up
3. Assume that cost of goods sold for a company consists only of variable costs and gross margin is = (revenue – cost of goods sold)/revenue. Which of the following is true