AllFreePapers.com - All Free Papers and Essays for All Students
Search

Brehm Vineyards

Autor:   •  February 14, 2016  •  Case Study  •  421 Words (2 Pages)  •  741 Views

Page 1 of 2

Brehm Vineyards

Production = 8,000 cases @ 12 bottles per case = 96,000 bottles per year

Good season = 10,000 cases @ 12 bottles per case = 120,000 bottles per year

Bad season = 5,000 cases @ 12 bottles per case = 60,000 bottles per year

Sell Price = $120 per case ($10 per bottle)

a) Flexible Budget assuming 8,000 cases of wine

 

Fixed Cost

Variable Cost

Volume (cases)

Grape Costs

 $240,000

 $2.10

8,000

Labor

 $75,000

 $2.15

Packing

 $-  

 $14.00

Selling and Admin Costs

 $36,000

 $-  

Utilities

 $4,000

 $0.75

Revenues @$120/cs

 $960,000.00

Grape Costs

 $256,800.00

Labor

 $92,200.00

Packing

 $112,000.00

Selling and Admin Costs

 $36,000.00

Utilities

 $10,000.00

Total Costs

 $507,000.00

Net Income

 $453,000.00

b)

Fixed costs = $355,000

Variable Costs = $19 (adding all variable costs)

MSRP = $120 per case

Break-even = $355,000/($120-$19)

Brea-even = 3,514.85 cases

c)

$300,00/(1-40%) = $500,000

# of cases = ($500,000 + $355,000)/($120-$19)

# of cases = 8,466 cases

d)

 

Fixed Cost

Variable Cost

Budgeted Total Cost

Actual Costs

Grape Costs

 $240,000

 $2.10

 $252,600.00

 $260,000

Labor

 $75,000

 $2.15

 $87,900.00

 $98,000

Packing

 $-  

 $14.00

 $84,000.00

 $83,000

Selling and Admin Costs

 $36,000

 $-  

 $36,000.00

 $39,000

Utilities

 $4,000

 $0.75

 $8,500.00

 $8,800

Budgeted

Actual

Difference

Outcome

Revenues @$120/cs

 $720,000.00

 $840,000.00

$120,000

F

Grape Costs

 $252,600.00

 $260,000.00

-$7,400

U

Labor

 $87,900.00

 $98,000.00

-$10,100

U

Packing

 $84,000.00

 $83,000.00

$1,000

F

Selling and Admin Costs

 $36,000.00

 $39,000.00

-$3,000

U

Utilities

 $8,500.00

 $8,800.00

-$300

U

Total Costs

 $469,000.00

 $488,800.00

-$19,800

U

Net Income

 $251,000.00

 $351,200.00

$100,200

F

...

Download as:   txt (3.2 Kb)   pdf (59.1 Kb)   docx (10.5 Kb)  
Continue for 1 more page »