Energy Device Inc.

1. Break Even (units) Formula: Fixed cost/Contribution (Contribution= Selling price- Variable cost)2. Break Even (units) Shower Nozzles: 27040/(10-8)= 13520 units

3. Break Even (units) Thermostats: 6760/(80-70)= 676 units

4. Break Even (units) Storm windows: 16900/(100-95)=3380 units

BREAKEVEN POINT (IN UNITS)

Ways to Eliminate Losses

Particulars Shower Nozzles

Thermostats Storm Windows

Number of items 4000 400 1200

Price/ item $12 $85 $105

Total Revenue $48000 $34000 $126000

Purchase price/ item

$6 $65 $90

Total purchase cost

$24000 $26000 $108000

Fixed cost(including Labor)

$22000 $6500 $16000

TOTAL COST $46000 $32500 $124000

PROFIT $2000 $1500 $2000

Estimated Budget Showing Profit

Bulk Purchase Encourage to Promotional Activity Reduce Unnecessary Labour Emphasis on cost reduction Moving above Break even point

Contd………..

Financial Concern To boost sale

Particulars Thermostats

Number of items 500

Price/ item $85

Total Revenue $42500

Purchase price/ item $65

Total purchase cost $32500

Fixed cost(including Labor+ Advertisement)

$6760+$1000=7760

TOTAL COST $40260

PROFIT $2240

Bulk Purchase

Encourage to Promotional Activity

Reduce Unnecessary Labour

Emphasis on cost reduction

Moving above Break even point

Advice regarding Shower Nozzles

Contd……….

Particulars Shower Nozzles

Number of items 4000

Price/ item $12

Total Revenue $48000

Purchase price/ item $6

Total purchase cost $24000

Fixed cost(including Labor)

$22000

TOTAL COST $46000

PROFIT $2000

Thanks……….