Follow the instructions for Project 4 below. The example included is based on the set of information for a nonprofit event that we used in our notes for CH15. You will recognize the numbers! You may make up any numbers for your Project 4, just don't use my numbers!

For this project, you will create a scenario for a business or other organization and use CVP analysis to show the following:

1. Breakeven in units
2. Breakeven in dollars
3. Target sales in units for achieving a $50,000 target NI
4. Target sales in dollars for achieving a $50,000 target NI
5. You realize that your scenarios actual capacity is limited to its breakeven number of units (BEu, as calculated in #1 above). Calculate what the new sales price (SP) should be in order to achieve a $10,000 NI using the BEu (#1 above) for sales volume (Q).
6. Same as #5, except this time calculate what the new variable cost per unit (VC) would need to be in order to achieve a $10,000 NI using the BEu (#1 above) for sales volume (Q).

Requirements:

1. Define each CVP variable for your scenario:

SP =

VC =

FC =

2. Calculate:

CM per unit =

CM ratio =

3. Calculate #1 6 above, showing all calculations