Task 2 requires you to answer the following questions to demonstrate your knowledge. Complete the answers in the space provided and if you need more space, use your own paper putting your name at the top and the Task and Task letter beside each answer.

1. The CEO of Bounce Fitness is presenting her business plan to her bank manager to support a request for a loan to open another fitness centre, this time in Perth. The business plan includes a section on the business's Market and Competition and a section on its Financial Forecasts.

Describe how each of these two sections would help the bank manager establish if the loan represents a sound investment.

2. The executive managers of Bounce Fitness are thinking about running a series of promotions to encourage children to get involved in classes with their parents throughout the months of December and January to avoid the reduced numbers of attendees during school holidays. If successful, it is anticipated that they will continue the promotion for one or two weeks during all school holidays.

State four points the managers should consider before going ahead with the proposal.

3. The business plan for Bounce Fitness includes three key targets, which are most important if the profit objective is to be achieved. These targets are:

Increase the gross profit on sales to 60% throughout the year for the year.

Reduce salaries and wage costs to 25% of sales.

Reduce controllable expenses to 15% of sales.

After 6 months their accounts show the following actual performance:

$

Total Sales

480,000

Cost of Sales

201,600

Salaries and wage costs

134,400

Controllable expenses

70,000

Choose two of the targets and using the actual performance figures above, assess whether the business has achieved these targets in the first six months.