Burgertown Report Research Paper Example | Topics and Well Written Essays - 1750 words

Burgertown Report - Research Paper Example1.2312Staff live1276640.7494.952Total Variable bell406.952Marginal component2600000.00295.048Fixed Cost83Depreciation Cost25Total Fixed Cost108 put on Before Interest 187.048& Tax (PBIT)Interest3012% on Rs. 250000Profit Before Tax (PBT)157.048c) Break Even PointFixed Cost / Marginal Contribution 95170.96Per UnitAs you can see above that by producing 95,170.96 units the total sales realized would be equal to the total cost and thus the firm would be under Break Even situation import thereby that they would be a no profit no loss situation. d) Margin of Safety Actual Sales - Break Even Sales164829(in volumes)The buckram is in a better situation as the Margin of Safety is in a much strong position both in terms of quantity as shown above and in percentage as shown below = Margin of Safety / Total Sales * 100164829 / 260000 * 100 = 63.40% f) No. of units to be produced extra to gain additional profit of Rs. 50,000PARTICULARSNo. of UnitsRat eValueSalesx2.902.90xVariable CostCost of Mealsx1.21.2xStaff Costx0.740.74xTotal Variable Costx1.94xMarginal Contribution0.96x(Sales - Total Variable Cost)Fixed Cost (Break up given below)173000Depreciation Cost25000Total Fixed Cost198000Profit Before Interest 237048& Tax (PBIT)(Stated that the profits would be 50,000 additional than the earlier profitsAlso Marginal Contribution = Fixed Cost + Profit Before Interest & TaxTherefore no. of units produced to achieve an additional profit of Rs. 50,000 would be(237048+198000) /... Some limitations are typically due to the lack of precision in the numbers (e.g., what is the actual price, is it purchase price or life cycle price) and getting the precise figures for fixed and protean costs. Beyond that, it is limited by its total focus on the quantitative elements of a business plan and doesnt consider competitive reactions, customer needs, etc.http//books.google.co.in/booksct= dissolver&id=958o8MoaYmMC&dq=high- low+method++variable+labour +cost+per+meal+and+the+ annual+fixed+labour+cost.&ots=RibYVyeuS7&pg=PA133&lpg=PA133&sig=ACfU3U2ievG4GwJltFY_kQEL94YQYXEaKw&q=high-low+method++variable+labour+cost+per+meal+and+the+annual+fixed+labour+cost.+PPA135,M1