ACCT140 W5 DIS

Description

This discussion is a continuation from weeks 1 and 2. In week 1, you identified costs that your business would incur. This discussion will take the information a step further.

1. Create $ amounts for each cost you described in Week 1 (to the best of your ability) and determine how much of the total cost is variable and how much of it is fixed. You will use this information to give us the following information:
   • Business name (remind us)
   • Product (remind us)
   • Contribution margin and ratio
   • Discuss the impact
   • Break-even
   • Break-even with a target profit (be realistic in your target profit)
   • Discuss the level of break-even and then break-even with a target profit, is this attainable?
   • Will your company be successful based on your CVP analysis?
2. Give an example of what changes may occur in your business that would cause your CVP formula to change. What would happen to the total cost if the change in the formula wasn’t made? Why?