Business Maths

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Marketing

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Business Maths

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Institution

Course

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2

Exercise 2

$

Manufacturer Price

5

Whole sellers

20%

Margin

Cost of Toy

5

Profit=(20% of 5)

1

Cost of the toy (5-1)

4

Jones Toy Store

Provides the Mark up of

40%

Profit Gained

1.6

Selling Price (Cost +

Profit)

S.P =4+1.6

5.6

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1 Business Maths Name Institution Course Instructor Date 2 Exercise 2 $ Manufacturer Price 5 20% Whole sellers Margin Cost of Toy 5 Profit=(20% of 5) 1 Cost of the toy (5-1) 4 Jones Toy Store Provides the Mark up of 40% Profit Gained 1.6 Selling Price (Cost + Profit) S.P =4+1.6 5.6 3 Exercise 3 Leaven's Box & Label Production Capacity 1,000,000 Units Fixed cost $2,000,000 Selling Price $10 Variable cost $5 Decision Making w1 -Compute Contribution Margin Selling Price $10 Less Variable Cost $5 Contribution Margin $5 B.E.P = Fixed Cost Contribution Margin $2,000,000 $5 B.E.P 400,000.00 From the analysis of the market, it would require the business to sell 400,000 units of Toys to break even. Having considered the market capacity to be beyond the break-even unit, Leaven’s Box & Label should pursue the business idea 4 Exercise 4 Unit Contribution is calculated by subtracting unit variable cost from Unit sales price But, B.E. P= Fixed Cost/contribution per unit From the info provided; BEP=450,000 Fixed cost= (50,000+40,000) =90,000 Therefore; 450,000= 90,000/(SP-VC) Where; SP is Unit Sales price= 3 VC is Unit Variable cost, assume x Hence; 450,000= 90,000/(3-x) 90,000=450,000(3-x) 90,000= 1,350,000-450,000x 90,000-1,350,000=-450,000x -1,260,000= -450,000x X=-1,260,000/-450,000 X=2.8 Therefore, Contribution per unit= (3-2.8) =0.2 5 Exercise 5 Customers spent 1,200,000 Retail Price 2 Retail Margin 33% Wholeseller Margin 25% Manufac ...
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