MODULE 3: Profit decisions are important to the Martins. These decisions not only arise from understanding the market, pricing policies and margins the managers need to understand the tools and elements they need to consider as they target either profit levels or their ability to manage the elements of the profit calculation. For example, if CompuTech is operating at a loss or below BREAK EVEN then understanding how they might be able to manage costs, or volumes to generate profits becomes very important. BREAKEVEN analysis can help the Martins and CompuTech decide on any of the following: how many units they need to sell, what price should they sell at (and compared to what the market will bear), what levels their fixed costs are at, what product or service should a company promote more or less. Assuming the following: (i) the sales price for each CompuTech product sold is $50; (ii) each product sold costs $25 in Raw Material components; and the business Fixed Cost is as determined in your Income Statement.

Q5: If the Sheridan student could impact unit sales by 20% growth, would their hiring be justified? Explain.

Q9: In a single EXCEL file complete a file displaying the three Income Statements that you have completed so far. Leave two blank columns between each year so that later we can do account changes between years.

REMEMBER THAT CompuTech is still being formulated. Your work is expected to give insight to the Martins as to what are key issues, what is the prognosis for their business and essentially how comfortable they believe the future is for their impending business.