The Effect Of Cost On The Profitability Of The Businesses Essay

| The customers would be influenced because if the company are financially struggling the customers are there only hope to stay profiting. If the company was to go bust it means customers will no longer be able to shop there. The customers would be an external stakeholder, they can get information by advertisements and even check their annual report on the businesses website.

The change in the contribution margin for all the products is responsible for the change in profitability.

The week four individual paper addresses the implementation of Activity Based Costing (ABC) by Super Bakery, Inc., a virtual corporation founded by Franco Harris. Specifically, management strategies, the reasoning behind an ABC system, and the alternatives of a job order cost system or a process order cost system are assessed for this enterprise.

Please note that this Assessment document has 8 pages and is made up of 7 Sections.

Please note that this Assessment document has 8 pages and is made up of 7 Sections.

A profit and loss account is supposed to show a businesses’ income and expenditures and calculate the company’s net profit or loss based on the difference between those numbers. It is really useful in determining past performance and to try to predict future

a. You need produce an informative leaflet which includes an explanation of the role of advertising agencies. It should explain the role that Adam & Eve DDB played in at least one of Marmite’s successful promotional campaigns eg Marmite’s Election Campaign, Marmite’s Neglect Campaign. Your leaflet should include the following:

Fixed costs in 2004 are lower that of 2003 and contribution margin ratio is higher in 2004 than that of 2003. Hence, the break even point is lower for 2004.

In addition to affecting profits by adjusting useful life and depreciation; key ratios will also be affected. The net profit margin can be influenced both ways to fit the purpose of business strategy. It could be increased to make it seem more profitable, or it can be influenced in a negative way to write off as much expenses as possible – if the year held disappointing results – in order to show next year more positively in comparison.

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.

A survey was conducted to determine whether or not Starbucks should introduce lunch and dinner foods to the menu. Three thousand individuals were surveyed at various retail locations and malls. A series of 11 questions regarding the likes and dislikes of current food and beverage choices as well as possible future lunch and dinner options revealed several findings for Starbucks. Starbucks has decided to analyze the data as follows. If, 60% of the individuals answered Agree or above on a question Starbucks would accept. Furthermore, if seven of the eleven questions received 60% in the Agree or above column, the

Opportunity cost is the value of the next best alternative in a decision. Imagine that you have $150 to see a concert. You can either see "Hot Stuff" or you can see "Good Times Band." Assume that you value Hot Stuff's concert at $225 and Good Times' concert at $150. Both concerts cost $150 per ticket, but it would take you a couple of hours to drive to Hot Stuff's concert and you have to be in school (the next) morning for an exam. Good Times' concert is right here in town. Explain how you would assess the opportunity cost of seeing Good Times in concert. What is the opportunity cost of going to Good Times' concert?

A comparison of the direct and indirect cost that is associated with the navigation system within VectorCal and my company.

The purpose of this report is to analyze the opportunity to produce plastic components for cartridge production and choose the best alternative. It is predicted that the annual demand growth is a triangular distribution with a minimum of 5%, most likely of 17% and a maximum of 25%. Due to the continuous growth in the demand, the alternatives cannot be compared using just the data for 2010. An analysis is carried out for the time period 2011 to 2015 and the present worth of the net income is considered as the criteria to select the alternative. The analysis basically can be divided into 5 steps:

Cost behavior is one of the most important aspect which helps in analyzing the nature and responses of different costs. Generally the cost behavior is breakdown of costs into fixed and variable components. The cost behavior is usually analyzed with the help of CVP analysis. The cost behavior patterns are analyzed by cost-volume-profit analysis, including the calculation of a firm 's break-even point in units and sales dollars.