Pricing Practical Application LU2 small business

LU2JamesConfectionersWorksheet1.xlsx

Sheet1

JAMES CONFECTIONERS
Financial Statements
INCOME STATEMENTS			20XX BREAKEVEN ANALYSIS
	20XX
		# units produced		12,875,000
Sales	$3,897,564	Price per Unit
COGS	$2,625,340	Fixed Costs
GP	$1,272,224	Variable Costs
SGA Exp.	$912,030
Deprec.	$74,054	INDICATED UNIT B/E
EBIT (Oper. Income)	$837,976
Interest	$119,658	INDICATED SALES B/E
Other Exp.	$1,248
EBT	$717,070
Income Taxes	$551,836		20XX CASH FLOW MGMT ANALYSIS
Net Income	$165,234
		Cash Conversion Cycle
BALANCE SHEETS
	20XX		20XX PRICING RECOMMENDATIONS
ASSETS
		Based on the ratio analysis from LU1 and your BE analysis
CURRENT ASSETS		here, what pricing recommendations would you have for
Cash	$161,254	James confectioners? Keep in mind that cocoa, milk and
Accounts Receivable	$507,951	sugar are increasing in price. Assume that cocoa has a
Inventories	$568,421	price elasticity of 2 and demand elasticity of .75.
Other Current	$116,909	Go to BLS.gov to research milk and sugar prices.
TOTAL CURRENT ASSETS	$1,354,535
		# units produced
FIXED ASSETS		Price per Unit
Gross PP&E		Fixed Costs
Accumulated Depreciation		Variable Costs
Net PP&E	$556,327
Other Fixed	$104,815	INDICATED UNIT B/E
TOTAL ASSETS	$2,015,677
		INDICATED SALES B/E
LIABILITIES & EQUITY
CURRENT LIABILITIES
Accounts Payable/Accruals	$312,430
Short Term Debt	$362,822
TOTAL CURRENT LIABILITIES	$675,252
LONG TERM DEBT	$564,390
STKHLDRS EQUITY
Common Stock (par+paid-in)	$1,000
Retained Earnings	$775,036
TOTAL LIABILITIES & EQUITY	$2,015,678