Question
Fixed Costs Amount Full Time Employee Expenses 84,000 Casual Employee Expenses 70,874 On-costs 46,462 Property Outgoings 19,200 Rental costs 42,000 Interest Expense 9,000 Depreciation 30,000
Fixed Costs | Amount |
Full Time Employee Expenses | 84,000 |
Casual Employee Expenses | 70,874 |
On-costs | 46,462 |
Property Outgoings | 19,200 |
Rental costs | 42,000 |
Interest Expense | 9,000 |
Depreciation | 30,000 |
Total Fixed Costs | 301,536 |
Variable Cost per Unit | |
Unit Price of Good | $7.00 |
Cost of Goods Sold | $1.87 |
Royalty | $0.56 |
Marketing Contribution | $0.49 |
Total Variable Cost per Unit | $2.92 |
Contribution Margin | $4.08 |
|
|
| One year |
Berry Bang's sold
|
| 1750 | 91000 |
Revenue
|
| $7.00
| 637,000
|
Cost of Sales
|
| $1.8700
| 170,170
|
Royalty
|
| 8.00%
| 50,960
|
Marketing
|
| 7.00%
| 44,590
|
Total Variable Costs
|
|
| 265,720 |
Contribution
|
|
| 371,280
|
Full-Time Employee Costs
|
| $42,000
| 84,000
|
Casual Employee Costs
|
| $18.93
| 70,874
|
On-Costs
|
| 30%
| 46,462
|
Total Employee Costs
|
|
| 201,336 |
Store Costs (outgoings)
|
| $1,600
| 19,200
|
Occupancy Cost (rent)
|
| $3,500
| 42,000
|
Total Operating Costs
|
|
| 262,536 |
EBITDA
|
| 17%
| 108,744
|
Interest
| 150,000
| 6.00%
| 9,000
|
Depreciation
| 300,000
| 10.00%
| 30,000
|
Total Fixed Costs
|
|
| 301,536
|
Pre-Tax Profit
|
|
| 69,744
|
Tax
|
| 30%
| 20,923
|
Net Income
|
|
| 48,821
|
Based on your income statement for the Top Juice franchise, in the first year of operation, estimate the free cash flow which the franchise will generate in that year.
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