Using the excel spreadsheets:
Recalculate the break-even point on the basis of the following what-if scenarios:
-Variable costs increase by 5%
-The sales price decreases by 10% due to an increase in competition
Create a 4-6 page paper that includes the above calculations and analyzes the decision options
Create a one page memo for your senior management that summarizes your findings and provides recommendations
Review standard office memo templates
Apply APA standards to citation of shoes
(in thousands) Thursday, September 30, 2010 Friday, September 30, 2011 ASSETS Current assets: Cash and cash equivalents Restricted cashcurrent portion Accounts receivable, less allowance for doubtful accounts Inventories Income taxes receivable Deferred income taxes Other current assets Total current assets Property, plant and equipment, net Deferred income taxeslong-term portion Prepayments and deferred charges Restricted cashlong-term portion Other intangible assets including Goodwill, net Total assets $97,550 $190 $102,054 $190 $49,650 $50,643 $106,900 $650 $9,213 $1,136 $265,289 $148,921 $59,352 $3,076 $110 $37,020 $513,768 Sunday, September 30, 2012 Monday, September 30, 2013 Cash equivalent is a liquid asset, for example, a bank deposit, that can be easily converted into$108,950 cash. Click any red icon below for$190 information. Tuesday, September 30, 2014 $98,050 $110 $107,890 $1,110 $56,501 $49,200 $75,510 $100,238 $987 $9,125 $973 $264,210 $167,860 $59,182 $2,941 $110 $37,090 $531,393 $115,559 $879 $9,300 $1,300 $292,679 $177,302 $59,522 $3,212 $110 $36,951 $569,775 $49,089 $49,786 $348 $8,950 $645 $698 $8,650 $2,000 $206,392 $245,644 $25,600 $8,448 $16,640 $1,890 $109 $52,687 $3,097 $64,030 $603 $142,050 $31,850 $10,511 $20,703 $1,980 $108 $65,151 $3,074 $41,228 $409 $152,791 $40,506 $13,037 $23,960 $2,001 $109 $79,613 $1,580 $59,509 $397 $156,900 $262,467 $262,653 $11 $226,820 $58,843 $2,670 $110 -- $13,214 $228,075 $47,200 $3,753 $12,900 $508,049 $537,572 $41,970 $17,890 $27,890 $2,500 $110 $54,284 $21,780 $18,758 $2,500 $1,009 $90,360 $98,331 $297,999 $1,482 $36,070 $292 $169,870 $298,074 $5,434 $39,250 $308 $170,802 $314,125 $11 $11 $12 $13 $217,631 $33,659 $220,926 $47,803 $223,220 $48,246 $227,650 $237,989 ($17,687) ($14,855) $251,301 $513,768 $268,740 $531,393 $271,476 $569,475 $209,975 $508,049 $223,147 $537,272 LIABILITIES AND STOCKHOLDERS' EQUITY Liabilities Accounts payable Accrued expenses Accrued pension and postretirement benefits Deferred revenuecurrent portion Current maturities of long-term obligations Total current liabilities Long-term obligations (less current portion) Deferred revenue (less current portion) Non-current income taxes payable Accrued pension and postretirement benefits Total liabilities Stockholders' equity: Common stock, $0.001 par value (40,000,000 shares authorized) Additional paid-in capital Retained Earnings (Accumulated Loss) Total stockholders' equity Total liabilities and stockholders' equity For the period ending: Net Revenues (dollars in 000s) Computer component Manufacturing Auto Compnents Manfacturing Other markets Total Business Unit Revenue Other revenue Net revenues Cost of sales Gross Profit Selling, general and administrative expenses Research and Development Impairment of Goodwill Operating income (loss) Interest income Interest expense Income (loss) before income taxes Provision for (benefit from) income taxes Net income (loss) Thursday, September 30, 2010 Friday, September 30, 2011 Sunday, September 30, 2012 Monday, September 30, 2013 $135,023 $128,978 $42,002 $306,003 $5,600 $311,603 $210,000 $146,897 $81,025 $437,922 $10,600 $448,522 $248,790 $165,498 $86,995 $501,283 $15,066 $516,349 $286,675 $399,185 $475,041 $24,928 $49,337 $41,308 $19,008 $2,119 $31,845 $3,050 $37,053 $3,511 $3,802 $68 $309 $3,561 $14,442 $98 $396 $14,144 $744 $149 $450 $443 Tuesday, September 30, 2014 $14,144 $443 $149,088 $109,098 $60,279 $318,465 $13,001 $331,466 $280,890 $50,576 $35,470 $3,120 $23,737 $4,105 ($74,192) $11,001 $138 $647 $98 $1,550 ($74,701) $9,549 ($8,768) $3,561 $188,906 $129,540 $53,237 $371,683 $12,033 $383,716 $396,844 ($13,128) $34,207 $6,717 ($65,933) $2,832 Continuing with the same scenario as in previous assignments for Compnet, complete the following: Select the links that follow to download and review the files containing the financial data of the product line. o Compnet Balance Sheet Income Statement o Compnet Budget Template Recalculate the break-even point on the basis of the following what-if scenarios: o Variable costs increase by 5 percent. o The sales price decreases by 10 percent due to an increase in competition. o Click here to access the CVP template and use it to perform your calculations. Create a 4-6 page paper that includes the above calculations and analyzes the decision options. Create a one-page memo for your senior management that summarizes your findings and provides recommendations. Submission Details: Create 5-7-page document in Microsoft Word that includes both the memo and the paper. Review standard office memo templates available on the internet and create the one-page memo in Microsoft Word considering the audience to whom this information needs to be presented. Apply APA standards to citation of sources. Use the following file naming convention: LastnameFirstInitial_M4_A2.doc. For example, if your name is John Smith, your document will be named SmithJ_M4_A2.doc. (in thousands) ASSETS Current assets: Cash and cash equivalents Restricted cashcurrent portion Accounts receivable, less allowance for doubtful accounts Inventories Income taxes receivable Deferred income taxes Other current assets Total current assets Property, plant and equipment, net Deferred income taxeslong-term portion Prepayments and deferred charges Restricted cashlong-term portion Other intangible assets including Goodwill, net Total assets LIABILITIES AND STOCKHOLDERS' EQUITY Liabilities Accounts payable Accrued expenses Accrued pension and postretirement benefits Deferred revenuecurrent portion Current maturities of long-term obligations Total current liabilities Long-term obligations (less current portion) Deferred revenue (less current portion) Non-current income taxes payable Accrued pension and postretirement benefits Total liabilities Stockholders' equity: Common stock, $0.001 par value (40,000,000 shares authorized) Additional paid-in capital Retained Earnings (Accumulated Loss) Total stockholders' equity Total liabilities and stockholders' equity Thursday, September 30, 2010 Friday, September 30, 2011 Sunday, September 30, 2012 Monday, September 30, 2013 Tuesday, September 30, 2014 $97,550 $190 $102,054 $190 $108,950 $190 $98,050 $110 $107,890 $1,110 $49,650 $50,643 $56,501 $49,200 $75,510 $106,900 $650 $9,213 $1,136 $265,289 $148,921 $59,352 $3,076 $110 $37,020 $513,768 $100,238 $987 $9,125 $973 $264,210 $167,860 $59,182 $2,941 $110 $37,090 $531,393 $115,559 $879 $9,300 $1,300 $292,679 $177,302 $59,522 $3,212 $110 $36,951 $569,775 $49,089 $49,786 $348 $8,950 $645 $698 $8,650 $2,000 $206,392 $245,644 $25,600 $8,448 $16,640 $1,890 $109 $52,687 $3,097 $64,030 $603 $142,050 $31,850 $10,511 $20,703 $1,980 $108 $65,151 $3,074 $41,228 $409 $152,791 $40,506 $13,037 $23,960 $2,001 $109 $79,613 $1,580 $59,509 $397 $156,900 $262,467 $262,653 $11 $226,820 $58,843 $2,670 $110 -- $13,214 $228,075 $47,200 $3,753 $12,900 $508,049 $537,572 $41,970 $17,890 $27,890 $2,500 $110 $54,284 $21,780 $18,758 $2,500 $1,009 $90,360 $98,331 $297,999 $1,482 $36,070 $292 $169,870 $298,074 $5,434 $39,250 $308 $170,802 $314,125 $11 $11 $12 $13 $217,631 $33,659 $220,926 $47,803 $223,220 $48,246 $227,650 $237,989 ($17,687) ($14,855) $251,301 $513,768 $268,740 $531,393 $271,476 $569,475 $209,975 $508,049 $223,147 $537,272 For the period ending: Net Revenues (dollars in 000s) Computer component Manufacturing Auto Compnents Manfacturing Other markets Total Business Unit Revenue Other revenue Net revenues Cost of sales Gross Profit Selling, general and administrative expenses Research and Development Impairment of Goodwill Operating income (loss) Interest income Interest expense Income (loss) before income taxes Provision for (benefit from) income taxes Net income (loss) Thursday, September 30, 2010 Friday, September 30, 2011 Sunday, September 30, 2012 $135,023 $128,978 $42,002 $306,003 $5,600 $311,603 $210,000 $146,897 $81,025 $437,922 $10,600 $448,522 $248,790 $165,498 $86,995 $501,283 $15,066 $516,349 $286,675 $399,185 $475,041 $19,008 $2,119 $31,845 $3,050 $37,053 $3,511 $3,802 $68 $309 $3,561 $14,442 $98 $396 $14,144 $744 $149 $450 $443 $3,561 $14,144 $443 $24,928 $49,337 $41,308 Monday, September 30, 2013 Tuesday, September 30, 2014 $188,906 $129,540 $53,237 $371,683 $12,033 $383,716 $396,844 ($13,128) $34,207 $3,120 $23,737 $149,088 $109,098 $60,279 $318,465 $13,001 $331,466 $280,890 $50,576 $35,470 $4,105 ($74,192) $11,001 ($74,701) $9,549 $138 $647 ($8,768) ($65,933) $98 $1,550 $6,717 $2,832 Budgeted Amounts Sales Sales price per unit Project Sales Volume (in units) Variable Cost per unit direct Labor Direct Materials Direct sales expense Fixed Cost Product management team Amortization of sales price Interest expense $35.00 1,500,000 $2.50 $6.00 $0.50 $5,000,000.00 $20,000,000.00 $3,000,000.00 Actual Sales Sales Actual average Sales Price Actual Sales (in units) Variable Cost per unit Actual direct labor Actual direct materials Actual sales expense Fixed Cost Product management team Amortization of sales price Interest expense $35.50 1,350,000 $2.75 $5.25 $0.65 $5,000,000.00 $20,000,000.00 $3,000,000.00
