That is, it is unacceptable to manually compute the solutions and simply insert the answers into the cells of an excel spreadsheet.) Raiders Ltd CVP Problem Prepare an Excel worksheet that illustrates cost-volume-profit (CVP) analysis, also referred to as breakeven analysis. Assume that a particular product sold at Raiders Ltd a US based toy company has a sales price per unit of $4.00; variable cost per unit of $2.20; and total fixed cost of $100,000. Task 1) Calculate the contribution margin per unit, the break-even point in units of sales, and the break-even point in dollars of sales. In the inputarea, show sales price per unit, variable cost perunit, and total fixed cost. In the output area, show contribution margin per unit, breakeven point in units, and breakeven point in dollars computed using appropriate formulas. Task 2) Assume that the planning team at Raiders Ltd estimates that for the next planning period selling price for this product will increase 50%; variable expenses will decrease 25%; and that total fixed cost will decrease 25%. Compute the new values for sales price per unit, variable cost per unit, and total fixed costs and then show contribution margin per unit, breakeven point in units, and breakeven point in dollars. Task 3) Assume the data in requirement 1). Prepare a CVP graph to illustrate breakeven analysis. To prepare the graph, first set up a table with columns for units, total fixed cost, total variable cost, total cost, sales revenue, and profit (Remember to use appropriate formulas to determine numerical values for these variables). In the units column, show values from zero to 70,000 in increments of 10,000. Graph the data in columns for total fixed cost, total cost, and sales revenue. Label your respective axes and lines. Note that by so doing you are graphing a CVP chart!
That is, it is unacceptable to manually compute the solutions and simply insert the answers into the cells of an excel spreadsheet.) Raiders Ltd CVP Problem Prepare an Excel worksheet that illustrates cost-volume-profit (CVP) analysis, also referred to as breakeven analysis. Assume that a particular product sold at Raiders Ltd a US based toy company has a sales price per unit of $4.00; variable cost per unit of $2.20; and total fixed cost of $100,000. Task 1) Calculate the contribution margin per unit, the break-even point in units of sales, and the break-even point in dollars of sales. In the inputarea, show sales price per unit, variable cost perunit, and total fixed cost. In the output area, show contribution margin per unit, breakeven point in units, and breakeven point in dollars computed using appropriate formulas. Task 2) Assume that the planning team at Raiders Ltd estimates that for the next planning period selling price for this product will increase 50%; variable expenses will decrease 25%; and that total fixed cost will decrease 25%. Compute the new values for sales price per unit, variable cost per unit, and total fixed costs and then show contribution margin per unit, breakeven point in units, and breakeven point in dollars. Task 3) Assume the data in requirement 1). Prepare a CVP graph to illustrate breakeven analysis. To prepare the graph, first set up a table with columns for units, total fixed cost, total variable cost, total cost, sales revenue, and profit (Remember to use appropriate formulas to determine numerical values for these variables). In the units column, show values from zero to 70,000 in increments of 10,000. Graph the data in columns for total fixed cost, total cost, and sales revenue. Label your respective axes and lines. Note that by so doing you are graphing a CVP chart!
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:That is, it is unacceptable to manually compute the solutions and simply insert
the answers into the cells of an excel spreadsheet.)
Raiders Ltd CVP Problem
Prepare an Excel worksheet that illustrates cost-volume-profit (CVP)
analysis, also referred to as breakeven analysis. Assume that a particular product
sold at Raiders Ltd a US based toy company has a sales price per unit of $4.00;
variable cost per unit of $2.20; and total fixed cost of $100,000.
Task 1) Calculate the contribution margin per unit, the break-even point in units of
sales, and the break-even point in dollars of sales. In the inputarea, show sales
price per unit, variable cost per unit, and total fixed cost. In the output area, show
contribution margin per unit, breakeven point in units, and breakeven point in
dollars computed using appropriate formulas.
Task 2) Assume that the planning team at Raiders Ltd estimates that for the next
planning period selling price for this product will increase 50%; variable expenses
will decrease 25%; and that total fixed cost will decrease 25%. Compute the new
values for sales price per unit, variable cost per unit, and total fixed costs and then
show contribution margin per unit, breakeven point in units, and breakeven point
in dollars.
Task 3) Assume the data in requirement 1). Prepare a CVP graph to illustrate
breakeven analysis. To prepare the graph, first set up a table with columns for
units, total fixed cost, total variable cost, total cost, sales revenue, and profit
(Remember to use appropriate formulas to determine numerical values for these
variables). In the units column, show values from zero to 70,000 in increments of
10,000. Graph the data in columns for total fixed cost, total cost, and sales
revenue. Label your respective axes and lines. Note that by so doing you are
graphing a CVP chart!
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