The company is planning to hold a luncheon event at a hotel it owns. The selling price for the event is priced at $200.

The maximum capacity for the event is 800 people.

The associated costs are given below: - Fixed costs $50,000 - Variable costs $80 per unit

Calculate the following on Excel workbook within Task 3 Cost-Volume-Profit Analysis worksheet. ( show all workings through appropriate Excel formulas.)

a) Contribution margin

b) Contribution ratio

c) Units required to breakeven

d) Sales revenue required to breakeven

e) Units required to achieve a target profit of $50,000

f) Salesrevenue required to achieve a target profit of $50,000

g) Highlight on the importance of Cost-Volume-Profit analysis and ensure you provide guidance on the maximum available profit for the event.

Transcribed Image Text:

CM CMR Break-even units (number of products) Break-even $ (sales revenue) Units required to achieve a target profit of $50,000 Sales Revenue required to achieve a target profit of $50,000 Yes 1,5 Yes 1,5 Yes 3 Yes 3 Yes 3 Yes TOTAL 3 15 CM CMR Break-even units (number of products) Break-even $ (sales revenue) Units required to achieve a target profit of $50,000 Sales Revenue required to achieve a target profit of $50,000 Yes 1,5 Yes 1,5 Yes 3 Yes 3 Yes 3 Yes TOTAL 3 15