WORKSHEET ON COSTS AND BREAKEVEN
NAME:QUESTION 1.:-
Total Marks 30
Marks obtained:Value Gym provided the following information [9]
Number of customers per day
Daily Variable cost per customer
Daily Gym fee per customer(Revenue)
Daily fixed costs
Blue for Revenue.
Green for Total Cost.
50
$5
$10
$100
Red for Fixed Cost
ACTIVITY 1
Using your IT skills and business knowledge on Break even, Your are required to develop a BREAK
EVEN CHART. (For the rotation of any line, click on the line, select PAGE LAYOUT From Menu bar and
you will see rotate menu bar on the far right click on it and select more rotation options. Try to use
arrow key TO position the lines.
THE BREAK EVEN CHART FOR VALUE GYM (VG)
Question 2:- Burnet manufacturers provided the following information. [9]
Burnet manufacturers a range of sports shoes. The Operations Director is planning to increase the scale of
production at its factory. She hopes it could lead to more than one economy of scale. The extra output
would allow Burnett to export its shoes for the first time.
TABLE 1: COSTS AND REVENUE FOR CURRENT PRODUCTION LEVELS
Fixed costs per month
Material costs per pair of shoes
Labour costs per pair of shoes
Average Selling price per pair of shoes
Planned sales per month (pair of shoes)
Blue for Revenue.
Green for Total Cost.
$250 000
$10
$15
$50
20 000
Red for Fixed Cost
ACTIVITY 2
Using your IT skills and business knowledge on Break even, you are required to develop a BREAK EVEN
CHART. (For the rotation of any line, click on the line, select PAGE LAYOUT From Menu bar and you
will see rotate menu bar on the far right click on it and select more rotation options. Try to use arrow
keys TO position the lines.
THE BREAKEVEN CHART FOR BURNET MANUFACTURERS
QUESTION 3
Define the following terms.
(a)
Fixed Costs [2]
(b)
Variable Costs [2]
( c)
Break Even point[2]
(d)
Margin of safety[2]
(e)
Calculate margin of safety in Question 1 and Question 2[4]