implicit in Bill French’s determination of his company’s breakeven point? There are a number of simplifying assumptions made by Bill French in his calculations of the breakeven point of his company‚ Duo – Products Corporation. First‚ he had assumed that the market conditions will remain the same. Second‚ his calculations are based on the last year prices; it does not take into account in any change in prices. Third‚ he also ignores any changes in the fixed and variable costs of the product‚ which
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RESTRICTED INTERNAL USE ONLY BILL FRENCH Bill French picked up the phone and called his boss‚ Wes Davidson‚ controller of DuoProducts Corporation. “Wes‚ I’m all set for the meeting this afternoon. I’ve put together a set of break-even statements that should really make people sit up and take notice – and I think they’ll be able to understand them‚ too.” After a brief conversation‚ French concluded the call and turned to his charts for one last checkout before the meeting. French had been hired six months
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should be able to cover all its costs‚ which are fixed and variable costs. It is measured in either product units or dollars. Bill French‚ Accountant The break even analysis is a very important tool to help any firm in deciding on the best operational volume. It requires three types of costs namely the fixed cost‚ variable cost and selling price (Dayananda‚ et al‚ 2002). As Bill French puts it‚ “the level of operation at which total costs that is‚ variable plus non-variable are just covered
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Bill French Case CASE : BILL FRENCH 1. What are the assumptions implicit in Bill French’s determination of his company’s break-even point? Assumptions Sales volume will be maintained. No planned changes in volume next year Only one‚ aggregate break-even point is utilized in the analysis. Sales mix will remain constant. Linearity will be exhibited by both total revenues and expenses over the relevant range. No capital investments that will increase fixed costs. Constant dividends are paid out to the
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Bill French Case 1. What are the assumptions implicit in Bill French’s determination of his company’s break-even point? He has assumed that there is only one break-even point for the firm’s three products by taking the average. Labor Union will not affect the product prices no effect on the break-even analysis. Constant dividends were given to stockholders. Production of product “A” will be decreased and the other hand product “C” capacity will be increased. Sales price will be constant.
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implicit in Bill French’s determination of his company’s break-even point? * He has assumed that there is just one breakeven point for the firm (by taking the average of the 3 products). * He has also assumed that the sales mix will remain constant. Total revenue and total expenses behave in a linear manner over the relevant range. * Since the capacity is being expanded to increase production of Product C‚ it could be assumed that this increase should be allocated to this product. Production
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Introduction: The M2 team’s idea for there product is simple and is called The Duo-Disc. It combines two simple products into one. Theses items would be a frisbee and boomerang. We would combine these products so you have the options to play with someone like a friend or family member or you can play by yourself. This product could be for all ages‚ but M2 is focusing on kids to buy this product. This paper is focusing on the industry Analysis for this product. The purpose of doing these Industry Analysis
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Lindsey Fork Huck Finn Paper Hr 4 English 10 The Dynamic Duo The Adventures of Huckleberry Finn remains to be one of the most controversial books that are taught in schools today. Many argue that it is racist and perpetuates inaccurate stereotypes. Although Mark Twain uses racism throughout the book‚ the novel should still be taught in schools. Even though there is a lot of controversy‚ The Adventures of Huckleberry Finn deserves to be taught in schools because it uncovers problems of intolerance
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Bill French case In this case‚ Bill French had gathered information and calculated Break Even Point (BEP) based on few assumptions: 1) Product mix considered constant. 2) Considered that there is just one breakeven point for the company. 3) Fixed and variable cost is assumed to be constant. 4) No inventory. 5) Price assumed to be fixed. Calculation of breakeven point based on assumptions: Table 1: Initial Cost analysis Initial Calculation Aggregates A’ B’ C’ Sales at full capacity (Unit) 2000000
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Areas of Consideration 2 The Breakeven Point 2 Implicit Assumptions and Limitations 2 Per Product versus Aggregate Breakeven Point 2 Change in Volume and Fixed Cost 3 Change in Product Mix and Sales Price 3 The Bonus Dividend Plan 3 Union Demand 4 Change in Product Emphasis 4 Recommendations 5 Revised CVP Income Statement 5 Required Levels of Operation 6 Case Context Case Background The case of Bill French is a good illustration to understand the use and limitations of Cost-Volume-Profit (CVP) Analysis
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