Operational Analysis : Operational Performance And The Furthering Of Company Strategy

1443 Words Jan 28th, 2016 6 Pages
Operational analysis is conducted in order to understand and develop operational processes. The operational analysis aims to determine whether each area of the organization is contributing effectively to overall performance and the furthering of company strategy by using various mathematical models, statistical analyses, and logical reasoning methods.
Operational Performance:
Net sales of our company in year 1 were 4,500 million dollars. The company must pay a variable operating cost of 3,510 million dollars from this amount. These variables consist of all materials and elements we need to pay for to properly perpetuate daily work. As a result we will have gross profit of 990 million dollars calculated when we subtract the variable cost of 3,510 million from the net sales of 4,500 million dollars. We then subtract the fixed operating cost of 60 million dollars leaving us with 930 million dollars. The depreciation cost was 33 million dollars leaving us with 897 million dollars. The interest amount that needed to be paid was 24 million dollars. That would leave the company with 873 million dollars. Taxes for that year were 35% of 873 million dollars putting us at 305.6 million dollars. The net income will be 567.5 million dollars. The company gained a total of 567.5 million dollars for the first year.
In year 2 net sales decreased. The net sales were 4,300 million dollars. As a result that year the variable operating costs were 3,345 million dollars. The fixed…
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