For this assignment you will pick a local business that is close to you or on your route of travel. You can choose any company, but it should be different from anyone else that you know from class. Take a photo of the outside of the business and include it in your final submission. The Assignment You will attempt to estimate, using reasonable assumptions, what a simplified contribution margin format income statement would look like for the business you choose. For example, Step 1: Estimate how many customers per hour or day they have and guess what the average transaction size might be. It doesnt matter if you are correct, just be reasonable. Use these estimates to forecast annual revenue and annual customer or transaction counts. Step 2: Imagine their expenses and classify them into variable and fixed. List three or four of each. For example, a car repair shop might have the following costs: Variable: 4 mechanics at $30 per hour including benefits Parts cost at 20% of revenue Utilities to run the power tools $3 per transaction Fixed: Employee to answer phone, and deal with customers $40,000 per year including benefits Advertising expense on Google $2,000 per month Monthly rent on the building, $5,000 per month Business taxes paid to city $12,000 per year Step 3: Use this information to build a contribution margin format income statement in Excel that is based on formulas so that you can make changes to volume or margins. Step 4: Adjust your estimates to so profit looks reasonable. If your numbers show them losing a million dollars on one location, you might want to adjust some of your assumptions. Step 5: Using the numbers, calculate the break-even sales $ and units values. Step 6: Design a what if scenario (eg. Increase marketing by $1,000 per month and get 10 new transactions per month) and use a copy your contribution margin income statement to estimate the change in profit. Based on the result, state your recommendation on implementing the change. Marks: Compiling the income statement with correct format and calculations (5 marks) Reasonableness of assumptions used (1 mark) Correctness of the break-even calculations, given the assumptions. (1 mark) Execution of the scenario and recommendation correctly (2 marks) Overall appearance, clarity, organization, spelling, and grammar (1 mark)