cvp and break even analysis need complete by 1am est

Ace your studies with our custom writing services! We've got your back for top grades and timely submissions, so you can say goodbye to the stress. Trust us to get you there!


Order a Similar Paper Order a Different Paper

Case Study:

Many of you will own your own business. One rapidly growing opportunity is no-frills workout centers. These types of centers attract customers who want to take advantage of state-of-the-art fitness equipment but do not need the other amenities of full-service health clubs. One way to own your own fitness business is to buy a franchise. Snap Fitness is a Minnesota-based business that offers franchise opportunities. For a very low monthly fee ($24, without an annual contract) customers can access a Snap Fitness center 24 hours a day. Start-up costs range from $60,000 to $184,000. This initial investment covers the following pre-opening costs: franchise fee, grand opening marketing, leasehold improvements, utility/rent deposits, and training.

Part 1, Section 1: Suppose that Snap Fitness estimates that each location incurs $4,500 per month in general fixed operating expenses and $900 to lease equipment. Mixed costs are equal to $600 per/month (fixed) plus $1 per membership sale (variable). Total variable costs were not provided. A recent newspaper article describing no-frills fitness centers indicated that a Snap Fitness site might require only 315 members per month to break even. Members pay on a monthly basis. Using the information provided above and your knowledge of CVP analysis, estimate the amount of variable costs. (When performing your analysis, assume that the only fixed costs are the estimated monthly operating expenses, equipment lease and the fixed part of the mixed costs.) Explain the results in the paper.

Part 1, Section 2: Using the information from section 1, what would monthly sales in members and dollars have to be to achieve a target net income of $17,000 for the month? Explain the results in the paper. How will you use break even analysis to manage your franchise?

Part 1, Section 3: Provide several examples of variable costs and fixed costs for a fitness center. Discuss how cost structure, relevant range, margin of safety, cost behaviors, and CVP apply to the case study. How do you plan to use this in order to manage the business and plan for profitability? What type of internal accounting reports would you prepare? Why?

Part 1, Section 4: Go to a competitor’s internet site and find information about purchasing their franchise. Summarize the franchise data so your team can make an informed business decision regarding your potential investment in Snap Fitness. Which franchise do you believe is a better business opportunity? Explain your answer.

Part 2: Assume your team decides to invest in the business. Prepare a variable costing income statement in Excel using monthly projections for revenue and expenses. Include a list of assumptions used to support the numbers incorporated with the income statement. Calculate the break-even point in dollars and number of members. Calculate the margin of safety. Incorporate the results of your analysis with the paper.

Review the case study posted to the week five projects thread and write a paper between 1,000 and 2,000 words addressing the following:

Part 1, Sections 1-4: Respond to the questions incorporated with the case study.

Part 2: Assume your team decides to invest in the business. Prepare a variable costing income statement in Excel using monthly projections for revenue and expenses. Include a list of assumptions used to support the numbers incorporated with the income statement. Calculate the break-even point in dollars and number of members. Calculate the margin of safety. Incorporate the results of your analysis with the paper.

Format the paper consistent with APA guidelines. Submit the paper, spreadsheet,

Most of it has been completed Just need it put together.

Writerbay.net

Looking for top-notch essay writing services? We've got you covered! Connect with our writing experts today. Placing your order is easy, taking less than 5 minutes. Click below to get started.


Order a Similar Paper Order a Different Paper