financial planning & sustainability - amazon s3€¦ · financial affairs. this plan allocates...

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Financial Planning & Sustainability

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Page 1: Financial Planning & Sustainability - Amazon S3€¦ · financial affairs. This plan allocates future income to various types of expenses, such as rent or utilities, and also reserves

Financial Planning & Sustainability

Page 21: Financial Planning & Sustainability - Amazon S3€¦ · financial affairs. This plan allocates future income to various types of expenses, such as rent or utilities, and also reserves

Breakeven Analysis - Class example i. Suppose that your fixed costs for producing 100,000 plantain

chips were N30,000 a year.

ii. Your variable (operating) costs are N2.20 materials, N4.00

labour, and N0.80 overhead, for a total of N7.00.

iii. If you selling price of N12.00 for each plantain chips, then:

iv. N30,000 divided by (N12.00 - 7.00) equals 6000 units.

v. This is the number of plantain chips that have to be sold at a

selling price of N12.00 before your business will start to make

a profit.