Budget
The sales of SG will total $425,200 with $93,600 from subscriptions and $331,600 from sales of gardens. Revenue for year two raises to $756,800 with $280,800 from subscriptions and $476,000 from sales of gardens. Revenue of the third year increases to $1,109,800 with sales of gardens increasing to $595,000 and subscription revenue to $514,800. Year one to two experiences a 77.8% growth and year two to three experiences 46.7% growth. These numbers are reasonable based on how diligently SG invests in marketing and sales. The reason growth fades from 77.8% down to 46.7% is due to the unlikeliness that extremely high and consistent growth will be sustainable for long periods of time.
The three largest expenses of SG include marketing and selling costs, material costs, and labor costs. The capital spent by the business per square foot is $9.24 (corrected from the original pricing plan), $3 per square foot for a contractor, $3 per square foot of cement, and $3.24 per square foot for sales. Since 17,000 square feet are predicted to be remodeled in the first year, marketing expenses for year one total $55,080. Expenses in the second and third years total $110,160 and $137,700 respectively. For contractors and materials, the first year costs are $51,000 each, $102,000 each for the second year, and $127,500 each for the third year.
The capital needed to fund SG to the point where it would generate positive income would be $3,500,000 (which is the approximate sum of all fixed
QUESTION 2: What total contribution is required to cover the new fixed costs and earn $500 profit per issue?
1- The total unit cost = Total Variable Cost + Production Fixed Expenses + Advertising Expense + Selling and Administrative Expense = 3.23 + 1.20 + 0.30 + 0.19 = 4.92.
As previously mentioned, net sales will be estimated beginning with the $61 million in net sales projected for 1991, then relying on Goldman Sach’s projected growth rate for 1992 and 1993, and using a 5% growth rate from that point forward. Net income is estimated for 1992 and 1993 using Goldman Sach’s estimate of the margin.
One of the major benefits of expansion is the reduction of fixed cost (fixed and selling). The cost is absorbed by 85,000 units instead of 80,000 units resulting in saving of $0.42 per unit.
Revenues and Direct Costs are as follows: $16,000,000 in total revenues, $9,833,155 in direct expenses, $6,166,845 in contribution margin, and 38.5% in percent of revenues. Their indirect costs are as follows: $1,200,000 in facilities costs, $1,600,000 in general overhead, and $2,800,000 in total overhead. This leaves the OP
Soda fountain bar 2 pizza ovens Salad and pizza/dessert bar Approximately 100 square foot commercial refrigerator 2 cash registers 6 video game vending machines Management office with desk and lower-priced laptop computer Staff lunchroom equipment such as microwave, sink, cupboards and refrigerator 20 four-seater tables with chairs Busing cart for transporting dirty dishes from the dining area to the dishwashing area 140 sets of dishes, including cutlery and drinking cups Commercial dishwasher Miscellaneous cooking and food handling equipment like trays, lifters, spoons, pots
* 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:
According to his financial model, the investment generates positive cash flow, excluding the initial investment, over the life of investment. This indicates further capital will not need to be raised for
Pilgrim was willing to lease back the 100,000 SF it occupied for revenue of $2,600,000. In exhibit one; we have an expense break down of expense per sf. In total $11.25 psf in
From 1976 to 1982 the compound annual growth in net sales was 18.5% and the compound annual growth of after tax profit was 25.9%. Therefore, a 10% net sales growth shown in the proforma financial data seems reasonable.
Manufacturing overhead Rent on production equipment........ $ 6,000 Insurance on factory building ....... 1,500 Depreciation on factory building............................................ 1,500 Utility costs—factory........................ 900 Property taxes on factory building............................................ 400 Miscellaneous expenses— factory .............................................. 1,000 Total manufacturing costs..................... Total cost of work in process ...............
Sales took the most percentage of total revenue. The revenue of sales increased gradually from $ 214,934 (in thousands) in 2010 to $ 260,832 in 2012 while the figure of royalties reduced gradually from $ 873 in 2010 to $ 681 in 2012 (in thousands). The revenue of other income increased from $ 1,286 to $ 1,325 during this period and then the figure decreased dramatically to $ 533 in the financial year 2012. In addition, in the financial year 2012, a new resource of revenue called membership was developed with the figure of $54.
The analysis of the table-1 reveals that future sales have been projected to grow at the rate of 20% per annum. The validity and reasonableness of there projections is questionable. There seems to be a very remote possibility of meeting their projections given the current scenario of the Letsgo. The points are raised about the validity and reasonableness of the projections:
Based on the sales manager’s research, he predicted 2,200,000 yards to be sold. In our financial model, we factored in a 7% increase in the average price per yard and a 10% increase in the average cost per yard, both of which the sales manager projected with confidence. The key underlying assumption this lead to was a 12.90% increase in revenue. Next, we averaged the past four years SG&A margin (SG&A/Sales) because this will serve as an adequate proxy for the forecasted SG&A expense. Although 2004 SG&A expense was an anomaly, we felt that it must be calculated in the average to accommodate for any shifting trends towards higher SG&A costs. Calculating interest expense was simple because we were given that Alliance Concrete pays 8.5% on outstanding debt. Our assumption for the tax rate came from the average tax rate the firm has paid out over the past 4 years, which was 34.81%.
1. Tyler’s total sales forecast for the nursery’s first full year of operations is 228,000 plants at an average sales price of $5 per plant. As a first approximation, assume that 30 percent of the firm’s customers will pay 10 days after the sale, 55 percent will pay on the 30th day, and 15 percent will pay on the 60th day.