W4A2: Final Project:Financial Statement: CVP Analysis
Assignment 2: Final Project
Financial Statement: CVP Analysis
Use the financial statements provided in the sidebar to compute the percentages for all items included in the income statement sheet as a percent of revenue. Remember that total revenue is always 100 percent. Be sure to use the formula function in Microsoft Excel to show the formulas for each of the percentage you compute. After completion, compute the following:
•CVP analysis with the following assumptions:
•Contribution margin
•Contribution margin ratio
•Current variable costs
•Fixed costs
•BEP
In addition, analyze and compute the sales figure forecast in case the owner of The Green Restaurant wants to generate a 15 percent increase in net income before taxes are deducted for the same period next year.
Save your assignment as W4_A2_lastname_firstname.xls.
Submit your assignment to the W4: Assignment 2 Dropbox. Use this Discussion Area to share the strategies you used for computing the sales figure forecast to generate 15 percent increase in net income before tax deduction for the next year. Comment on the postings submitted by at least two of your peers.
In a Word document, forecast a strategy to increase the net income for the next financial year by 15 percent. Your strategy should help you to decide whether expenses on a particular item need to be decreased or more money can be invested in another item to get better net income. You can use Internet resources to understand the current market trends of the restaurant business and devise a feasible strategy.
Forecasting strategies to increase income and overall revenue of an organization, based on percentage distribution of income statement items of the previous year, helps to populate better-budgeted income statements for the current year.
Follow MLA standards for writing the document. Name the document as W4_A2_lastname_firstname.doc.
Submit W4_A2_lastname_firstname.xls and W4_A2_lastname_firstname.doc to the Discussion Area. Use this Discussion Area to comment on the postings of at least two of your peers.
Note: You will be required to use W4_A2_lastname_firstname.xls in W5: Assignment 1.
Assignment 2 Grading Criteria
Maximum Points
Computed percentage of all items of the income statement of the given financial statements.
10
Computed the CVP analysis, contribution margin, contribution margin ratio, current variable costs, fixed costs, and BEP using the income statement in the given financial statements.
18
Analyzed and computed the sales figure forecast to generate a 15 percent increase in net income for the next year.
4
Prepared a document forecasting a strategy to increase the net income for the next financial year by 15 percent.
10
Used MLA guidelines to complete the report.
4
Commented on the postings submitted by at least two of your peers.
4
Total:
50
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