Trusted Charcoal Company Limited

Calculation of Fixed Cost

Fixed Cost per Year

Manufacturing Space 12500 x 12 150,000

Administration 10000 x 12 120,000
Office Supply 3000 x 12 36,000

Salary
Payload Operator 5000 x 12 60,000
Drivers 15000 x 12 180,000
Partners 25000 x 12 300,000

WC Financing 2000000 x 0.12 240,000

Sub Total 1,086,000

Amortization
3 Trucks 3000000/5 600,000
2 Furnace 1500000/5 300,000
Payload Machine 1500000/5 300,000

Sub Total 1,200,000

Total FC 2,286,000

Calculation of Variable Cost

Variable Cost
Raw Material Per Ton 4000
Labour Per Ton 200
Shipping Per Ton 300
Additional Material Per Ton 500
Electricity Per Ton 500
Total Variable Cost Per Ton 5500

Calculation of Contribution Margin

Selling Price of Charcoal Per Unit 8000
Variable Cost Per Unit 5500
Contribution Margin Per Unit 2500
Calculation of Breakeven Point

Breakeven point Fixed Cost/ Contribution 914.40

Profit Analysis
Annual Sales Tons 1000 1500
Revenue 8000 per Ton 8,000,000 12,000,000
Variable Cost 5500 per Ton 5,500,000 8,250,000
Contribution Margin 2,500,000 3,750,000
Fixed Cost 2,286,000 2,286,000 2,286,000
Profit 214,000 1,464,000
Return on investment 6000000 3.57% 24.40%
 2000
16,000,000
11,000,000
5,000,000
2,286,000
2,714,000
45.23%