Milestone Two Contribution Margin Analysis COLLARS LEASHES HARNESSES Sales Price per Unit Variable Cost per Unit Contribution Margin Milestone Two Break-Even Analysis COLLARS LEASHES HARNESSES Sales Price S S S Fixed Costs Contribution Margin S S S - BreakEven Units (round up) Target Prot S 300.00 S 400.00 S 500.00 BreakEven Units (round up) Target Prot S 500.00 S 600.00 S 650.00 BreakEven Units (round up) You have conducted some market research for style and size of products you want to use to launch your business. The market research has indicated the following sales price ranges will be optimal for your area depending on style of products you choose to sell: 0 Collars 0 With pricing at $20 per collar, you can expect to sell 30 collars per day. 0 With pricing at $24 per collar, you can expect to sell 25 collars per day. 0 With pricing at $28 per collar, you can expect to sell 20 collars per day 0 Leashes 0 With pricing at $22 per leash, you can expect to sell 28 leashes per day. 0 With pricing at $26 per leash, you can expect to sell 23 leashes per day. 0 With pricing at $30 per leash, you can expect to sell 18 leashes per day. 0 Harnesses 0 With pricing at $25 per harness, you can expect to sell 25 harnesses per day. 0 With pricing at $30 per harness, you can expect to sell 22 harnesses per day. 0 With pricing at $35 per harness, you can expect to sell 20 harnesses per day. Additionally, you will need to compare your break-even points for the following target prots for each area of your business to determine your prices: 0 Collars O Break-even 0 $300 target profit each month 0 $500 target profit each month 0 Leashes O Break-even 0 $400 target profit each month 0 $600 target profit each month 0 Harnesses 0 Break-even 0 $500 target profit each month 0 $650 target profit each month Remember that all break-even and target points must be in whole units (we cannot sell a partial unit). Round up when calculating partial units to ensure costs are covered. Excel tip use ROUNDUP function Milestone One - Variable and Fixed Costs Collars Item Variable Costlltem Item Fixed Costs Hightensile strength nylon webbing S 4.00 Collar maker's salary (monthly) S 2,773.33 Polyesterf'nylon ribbons S 3.00 Depreciation on sewing machines S 55.00 Buckles made of cast hardware S 2.00 Rent S 250.00 Price tags S 0.10 Utilities and insurance S 200.00 Scissors, thread, and cording S 400.00 Loan payment S 183.33 Salary to self S 166.67 Total Variable Costs per Collar S 9.10 Total Fixed Costs 5 4,028.33 Leashes Item Variable Cost/Item Item Fixed Costs Hightensile strength nylon webbing S 6.00 Leash maker's salary (monthly) S 2,773.33 Polyesterfnylon ribbons S 4.50 Depreciation on sewing machines S 55.00 Buckles made of cast hardware S 1.50 Rent S 250.00 Price tags S 0.10 Utilities and insurance S 200.00 Scissors, thread, and cording S 400.00 Loan payment S 183.33 Salary to self S 166.67 Total Variable Costs per Leash 5 12.10 Total Fixed Costs 5 4,028.33 Harnesses Item Variable Costfltem Item Fixed Costs Hightensile strength nylon webbing S 6.00 Harness maker's salary S 2,946.67 Polyesterfnylon ribbons S 4.50 Depreciation on sewing machines S 55.00 Buckles made of cast hardware S 4.00 Rent S 250.00 Price tags S 0.10 Utilities and insurance S 200.00 Scissors, thread, and cording S 400.00 Loan S 183.33 Salary to self S 166.67 Total Variable Costs per Harness 5 14.60 Total Fixed Costs 5 4,201.67r