STRATEGIC BUSINESS ANALYSIS

QUIZ NO. 2 - CVP ANALYSIS

1 B/D
2 B
3 B
4 D
5 B
6 C
7 A
8 D
9 D
10 C
11 C
12 D
13 C
14 D
15 C
16 C
17 B
18 A
19 A
20 A
21 B
22 C
23 A
24 BONUS
25 C
26 B
27 A
28 C
29 A
30 BONUS
31 B
32 B
33 A
34 C
35 B
 STRATEGIC BUSINESS ANALYSIS
QUIZ NO. 2 - CVP ANALYSIS
SOLUTIONS quiz

2 Net operating income

Divided by CMR
Divided by Net Operating income

4 Contribution margin per unit

Units sold inclusive of increase
Total contribution margin
Less: Net Operating income
Should be fixed costs
Less: current fixed costs
Allowable increase in fixed costs (advertising)

5
SMR in units
SMR in USP

USP
VC per unit
CM / unit
Weighted CM/Unit
CM R
Composite USP
Composite CM
Weighted CMR

Fixed cost
12% X = (53.33%X-1,800,000)70%
Sales to achieve 12% return 4,973,749.65
Composite Sales Price 4,800.00
Units 1,036.20

6 DOL is CM divided by Net income

Contribution margin per unit

 Units sold
Contribution margin
Net income
DOL

7 Sales
Variable Costs
Contribution margin

Fixed costs
Divided by CMR
BEP in pesos

9 DOL is CM / Net income

Net income is Contribution margin divided by DOL

At breakeven point (sales less margin of safety)
Breakeven point multiplied by CMR is FC

10 Fixed costs
Divided by 52 weeks a year
Fixed costs per week
Add: Operating Profit
Contribution margin
Divided by CMR

13 Is equal to the contribution margin per unit

15 10%SALES = 30%SALES LESS FIXED COSTS

16 Gross up the net income, thus Php 120,000 divided by 60%

17 Fixed costs equal to Contribution margin at BEP

Thus CM/unit is

18 Sales
Variable cost
CMR
 Desired Sales Fixed costs plus profit divided by CMR

22 USP
VC / unit
CM/U

% probability No. of units

40% 70 units will be sold
60% 40 units will be sold

Total CM
Fixed costs

23
Sales
VC
CM
CMR
SMR in USP
Weighted

24 BONUS

26 Sales
Variable costs
Contribution margin

Sales less Margin of Safety is BEP

BEP multiplied by CMR is FC

28 CMR
Multiplied by Sales

Less profit
Fixed costs at desired profit of Php 80,000
30

Sales price
Variable cost
Contribution margin

Weighted CM per unit

Fixed costs 840,000.00
CM per unit 14.00
BEP in units 60,000.00

31 Contribution margin per unit

No . Of units sold
 150,000.00
80.00%
187,500.00

10.00
180,000.00
1,800,000.00
200,000.00
1,600,000.00
1,500,000.00
100,000.00

3.00 5.00
TTT TTS TOTAL
37.50% 62.50%
83.33% 16.67%

1,200.00 240.00 1,440.00

480.00 160.00
720.00 80.00
270.00 50.00 320.00
60.00% 33.33%
3,600.00 1,200.00 4,800.00
2,160.00 400.00 2,560.00
53.33%

1,800,000.00

3,108.59 5,180.99

20.00
 25,000.00
500,000.00
50,000.00
10.00

80,000.00
20,000.00
60,000.00 0.75

30,000.00
0.75
40,000.00

75,000.00
300,000.00
225,000.00

52,000.00
52.00
1,000.00
2,500.00
3,500.00
20%
17,500.00

100.00

150,000.00

600.00
3.00

150.00
90.00
0.40
 1,050,000.00

37.50
12.50
25.00

Projected units CM/Unit Total

28.00 25.00 700.00
24.00 25.00 600.00
52.00 1,300.00

Option 1 Option 2 Option 3

1,300.00 1,300.00 1,300.00
1,000.00 847.5 390
300.00 452.50 910.00

Cake Cream Mallows

10,000.00 20,000.00 30,000.00 60,000.00
4,000.00 12,000.00 15,000.00
6,000.00 8,000.00 15,000.00
60.00% 40.00% 50.00%
16.67% 33.33% 50.00%
10.00% 13.33% 25.00% 48.33%

120,000.00
80,000.00
40,000.00 0.3333333333

96,000.00
32,000.00

30%
600,000.00
180,000.00
80,000.00
100,000.00

2.00 1.00
 A B
66.67% 33.33%

40.00 50.00
24.00 40.00
16.00 10.00

10.67 3.33 14.00

40,000.00 20,000.00

- -
13.00
4,600.00
59,800.00