Module 10

Documentation

Coltivare Tool
Author
Date
Purpose	To perform a break-even analysis of the Coltivare Tool line of power lawn mowers and to determine the product mix that optimizes company profits

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Income

Coltivare Tool
Income Analysis
Revenue
Units Produced and Sold	12,000
Average Price per Unit	$335
Total Revenue	$ 4,020,000
Variable Expenses
Units Produced	12,000
Average Material Cost per Unit	$155
Total Material Cost	1,860,000
Average Manufacturing Cost per Unit	$70
Total Manufacturing Cost	840,000
Total Variable Expenses	$ 2,700,000
Fixed Expenses
Salaries and Benefits	$ 775,000
Shipping and Distribution	95,000
Stocking and Storage	85,000
Miscellaneous	65,000
Total Fixed Expenses	$ 1,020,000
Summary
Total Revenue	4,020,000
Total Expenses	3,720,000
Net Income	$ 300,000

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Product Mix

Coltivare Tool
Product Mix Analysis
						Parts Required for Each Unit
Product Mix Analysis	CL150F	CL160F	CL160AW	CL190AW		Part	CL150F	CL160F	CL160AW	CL190AW
Sales Price per Unit	$272	$312	$358	$398		Mower Wheel (8")	4	0	4	0
Material Cost per Unit	$134	$148	$164	$174		Mower Wheel (10")	0	4	0	4
Manufacturing Cost per Unit	$62	$62	$78	$78		Front Axel	1	1	0	0
						Power Front Axel	0	0	1	1
Even Product Mix (Units)	3000	3000	3000	3000		Power Rear Axel	1	1	1	1
Optimal Product (Units)						Front Anti-skid Bar	0	0	2	2
Change	(3,000)	(3,000)	(3,000)	(3,000)		150cc Young & Holman Engine	1	0	0	0
						160cc Young & Holman Engine	0	1	1	0
Revenue (Even Mix)	$ 816,000	$ 936,000	$ 1,074,000	$ 1,194,000		190cc Young & Holman Engine	0	0	0	1
Revenue (Optimal Mix)	- 0	- 0	- 0	- 0		Standard Chassis	1	0	1	0
Change	(816,000)	(936,000)	(1,074,000)	(1,194,000)		Extended Chassis	0	1	0	1
						20" Cutting Deck	1	0	1	0
Summary	Even	Optimal	Change			22" Cutting Deck	0	1	0	1
Units Produced and Sold	12,000	- 0	(12,000)			Pull Cord	1	1	1	1
Total Revenue	$ 4,020,000	$ - 0	$ (4,020,000)			Mulch Catcher	1	1	1	1
Total Material Cost	1,860,000	- 0	(1,860,000)			Standard Speed Control	1	1	0	0
Total Manufacturing Cost	840,000	- 0	(840,000)			Variable Speed Control	0	0	1	1
Total Fixed Expenses	1,020,000	1,020,000	0			Push Bar	1	1	1	1
Net Income	$ 300,000	$ (1,020,000)	$ (1,320,000)			Assembly Kit	1	1	1	1
						Parts Available
						Part	Available	Used	Remaining
						Mower Wheel (8")	25,403	- 0	25,403
						Mower Wheel (10")	25,921	- 0	25,921
						Front Axel	6,305	- 0	6,305
						Power Front Axel	6,314	- 0	6,314
						Power Rear Axel	13,585	- 0	13,585
						Front Anti-skid Bar	14,273	- 0	14,273
						150cc Young & Holman Engine	4,085	- 0	4,085
						160cc Young & Holman Engine	6,360	- 0	6,360
						190cc Young & Holman Engine	3,711	- 0	3,711
						Standard Chassis	6,118	- 0	6,118
						Extended Chassis	6,715	- 0	6,715
						20" Cutting Deck	6,407	- 0	6,407
						22" Cutting Deck	6,391	- 0	6,391
						Pull Cord	13,431	- 0	13,431
						Mulch Catcher	13,935	- 0	13,935
						Standard Speed Control	7,385	- 0	7,385
						Variable Speed Control	6,819	- 0	6,819
						Push Bar	13,405	- 0	13,405
						Assembly Kit	14,827	- 0	14,827

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