Case 1 1 Trend Analysis The Coffee Palace just had its third business anniversary Alice Cornwell the company's owner recently became concerned Early in the year she increased her prices to bring in more revenue, adding $0 25 per cup to the regular and decaffeinated coffees she sells and reducing the price of novelty coffees to increase demand for them Specifically, materials to make specialty coffees average $1 25 a cup, while the cost for materials for regular coffee (the cup, a lid, and the coffee itself) is only $0 50 Labor for the novelty drinks is three minutes at $10 per hour, while labor for regular coffee drinks is only one minute Product Type Current Price in $ Last Years Price in $ Current Volume Last Years Vol Regular Coffee $1 75 $1 50 4,500 8,000 Decaffeinated Coffee $1 75 $1 50 4,000 5,800 Flavored Coffees $2 00 $1 75 4,000 6,000 Cappuccino $3 00 $3 25 3,000 2,000 Mochaccino $3 00 $3 25 2,500 1,800 Iced Cappuccino $3 25 $3 50 1,800 1,200 Iced Mochaccino $3 25 3 25 3,500 2,600 Regular Latte $2 50 $2 75 4,500 3,000 Flavored Latte $2 75 $3 00 3,000 2,100 Calculate the total costs (labor and materials for each type of product Alice makes Product Type Materials Labor Costs Total Cost per Cup Complete a table that determines the profit made per type of product sold by Alice Product Type Price Direct Costs Profit per Cup Do this for both years of data you have You should end up with two tables With profit per cup in hand, you can now calculate how much profit Alice makes for each different type of product by year Product Type Profit per Cup Volume Sold Total Profit Once again, calculate these numbers for two years Now do a trend analysis for profitability over the two years Produce Type Profit This Year Profit Last Year Change in Profit Percentage Change Now determine how much sales volume has changed Product Type Volume This Year Volume Last Year Change in Volume Percentage Change Using all this data, draft a one to two paragraph memo to Alice explaining what is happening and making recommendations to help her plan the next year

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Case 1.1 Trend Analysis. The Coffee Palace just had its third business anniversary. Alice Cornwell the company's owner recently became concerned. Early in the year

Case 1.1 Trend Analysis. The Coffee Palace just had its third business anniversary. Alice Cornwell the company's owner recently became concerned. Early in the year she increased her prices to bring in more revenue, adding $0.25 per cup to the regular and decaffeinated coffees she sells and reducing the price of novelty coffees to increase demand for them. Specifically, materials to make specialty coffees average $1.25 a cup, while the cost for materials for regular coffee (the cup, a lid, and the coffee itself) is only $0.50. Labor for the novelty drinks is three minutes at $10 per hour, while labor for regular coffee drinks is only one minute.

Product Type Current Price in $ Last Years Price in $ Current Volume Last Years Vol.

Regular Coffee	$1.75	$1.50	4,500	8,000
Decaffeinated Coffee	$1.75	$1.50	4,000	5,800
Flavored Coffees	$2.00	$1.75	4,000	6,000
Cappuccino	$3.00	$3.25	3,000	2,000
Mochaccino	$3.00	$3.25	2,500	1,800
Iced Cappuccino	$3.25	$3.50	1,800	1,200
Iced Mochaccino	$3.25	#3.25	3,500	2,600
Regular Latte	$2.50	$2.75	4,500	3,000
Flavored Latte	$2.75	$3.00	3,000	2,100

Calculate the total costs (labor and materials for each type of product Alice makes.

Product Type Materials Labor Costs Total Cost per Cup

Complete a table that determines the profit made per type of product sold by Alice

Product Type Price Direct Costs Profit per Cup

Do this for both years of data you have. You should end up with two tables. With profit per cup in hand, you can now calculate how much profit Alice makes for each different type of product by year.

Product Type Profit per Cup Volume Sold Total Profit

Once again, calculate these numbers for two years. Now do a trend analysis for profitability over the two years.

Produce Type Profit This Year Profit Last Year Change in Profit Percentage Change

Now determine how much sales volume has changed.

Product Type Volume This Year Volume Last Year Change in Volume Percentage Change

Using all this data, draft a one to two paragraph memo to Alice explaining what is happening and making recommendations to help her plan the next year.