Great Deal! Get Instant $10 FREE in Account on First Order + 10% Cashback on Every Order Order Now

Here is the textbook you will need to source from:https://open.lib.umn.edu/exploringbusiness/ Please use other resources as well and be sure to cite all.

1 answer below »
Microsoft Word - Financial Analysis Case Study.docx
Introduction    to    Business     Prof.    Hannah    Weiser    
Let’s    Throw    a    Business    Party!    
A    case    study    to    learn    how    to    project    sales,    research    and    estimate    expenses,    and    to    calculate    projected    profit/loss.        
This    analysis    will    include    the    development    of    an    income    statement    and    students    will    conduct    a    
eak    even    analysis.        
The    project    will    require    you    to    make    a    profitable    party    plan    as    a    business    
consultant,    determining    whether    the    party    is    financially    viable.    Please    be    
sure    to    review    the    assignment    to    determine    the    requirements.    To    
determine    whether    your    idea    for    a    party    is    practical,    you    will    need    to    
esearch    the    costs    of    party    finding    costs    in    the    industry    and    similar    parties    
and    venues    as    a    way    of    'benchmarking'.    You    will    then    need    to    think    critically    
to    answer    a    series    of    financial    questions    in    paragraph    form    (see    below).    
    
Remember
Breakeven?
For    the    purpose    of    conducting    this    analysis,    research    expenses    for    the    party.    You    will    need    to    
determine    actual    suppliers    you    can    purchase    from    and    actual    estimated    costs    based    on    your    research.        
Remember    to    cite    all    sources    in    MLA    format!    
Steps    to    build    the    Income    
Statement    
Income    Statement    (also    known    as    Profit/Loss    Statement)    
Step    1:    Determine    the    Projected    Revenue    -    (#    of    tickets    sold    for    the    party    
multiplied    by    the    price    charged    per    ticket).    You    will    need    to    review    and    utilize    
one    of    the    sales    projection    methods    from    the    Prezi    overview    for    Financial    
Analysis.        
Step    2:    Determine    the    major    expenses    (list    each    type    of    expense    and    how    
much    you    think    it    will    be).    Expenses    should    be    listed    as    “Cost    of    Goods    Sold”    –    
these    are    your    variable    expenses    for    the    party    that    change    based    on    the    
number    sold    (e.g.,    food).    Then,    the    remaining    expenses    should    be    listed    as    
“Operating    Expenses”    –    these    are    your    fixed    expenses    for    the    party    that    remain    
the    same    no    matter    how    many    tickets    you    sell.    
Step    3:    Profit    or    Loss?    Take    your    revenue    and    subtract    all    of    the    expenses.    If    
there    is    money    left    over,    you    have    a    profit.    However,    If    you    have    no    money    
leftover,    and    you    actually    have    more    expenses    than    revenue,    you    are    losing    
money.    You    may    need    to    consider    either    (1)    raising    the    price    charged    per    ticket,    
or    (2)    lowering    expenses.    

You    will    need    to    determine    how    many    
tickets    you    would    need    to    sell    at    your    
ticket    price    to    
eakeven.    Remember,    
the    
eak    even    formula    is:    
    
#    of    tickets    needed    to    
eak    even=    
    
fixed    expenses        
(price    charging    per    ticket    -    variable    
expenses,    i.e.,    the    cost    per    ticket    )    
    
Then,    to    determine    the    revenue    
needed    to    
eakeven,    just    multiply    the    
number    of    units    necessary    by    the    price    
you    are    charging    per    ticket.        


2    
Introduction    to    Business    Activity     Prof.    Hannah    Weiser    

    
Answer    the    questions    below    in    paragraph    format.    In    order    to    answer    the    questions    below    you    will    need    to    
conduct    research    and    make    assumptions.    Please    clearly    indicate    all    assumptions    you    make    throughout    you    
answers    to    each    question    and    cite    any    resources    used    using    footnotes.     (Hint:    The    lecture    material    from    our    
financial    analysis    module    and    the    4ps    of    marketing    module    will    be    helpful    in    conducting    this    analysis).    Make    sure    
to    use    PICK    Analysis    in    preparing    your    submission!    Your    paper    should    be    2-3    pages    long,    single    spaced.    
    
1. Determine    the    sales    price    for    a    ticket    to    your    party.    How    did    you    come    to    this    price?    Remember    to    use    the    
pricing    strategies    and    objectives    from    the    “pricing”    section    of    our    marketing    overview,    Ch.    13.    You    also    will    
want    to    “benchmark”    against    your    competition:    Who    are    three    competitors    and    what    are    they    charging?    What    
is    your    competitive    advantage?    Tip: Use pricing strategies and objectives from Learning Module 10 (pricing) in the text.    
    
2. Identify,    research,    and    estimate    major    expenses    for    your    party    to    calculate    what    you    expect    the    costs    will    be.        
You    should    get    creative    here    about    what    you    need    for    your    party    (e.g.,    security,    a    band,    food,    etc.).    Determine    
whether    the    costs    noted    are    fixed    (operating    expenses    that    do    not    change    no    matter    how    many    tickets    are    
sold)    or    variable    (costs    of    goods    sold,    which    change    based    on    the    number    of    tickets    sold).    (e.g.,    Staples    charges    
$5    for    a    roll    of    tickets).    
    
3. Using    this    proposed    pricing    structure    and    expenses    for    the    first    year,    calculate    the    
eak    even    point    -    the    
number    of    tickets    you    need    to    sell    to    
eak    even    and    the    revenue    needed    to    
eak    even.        Use    the    
eakeven    
analysis    information    from    the    “pricing”    section    of    our    marketing    overview,,    and    the    activity    available    under    the    
co
esponding    learning    module    10    to    help    you    understand    how    to    conduct    this    analysis.        
    
4. Identify    a    city    and    venue    for    this    party    in    the    state    of    Maryland,    supporting    your    choice    using    population    data    
(HINT:    U.S.    Census    Bureau    website)    and    additional    information    that    supports    your    reasoning.        
    
5. Based    on    your    target    market,    and    using    sales    projection    methods    from    the    financial    analysis    learning    module    
12    Prezi    overview,    project    the    potential    sales    (revenue)    for    this    party.    Will    it    exceed    your    
eak-even    point?    
Tip:    Make    sure    to    use    a    strategy    from    the    prezi    overview,    such    as    the    “build    up”    approach.    
    
6. Using    the    revenue    information    collected    and    the    expense    estimates,    prepare    an    income    statement    (i.e.,    
profit/loss    statement)    to    calculate    the    projected    profit/losses    in    year    one    for    this    business.    Tip:    Learning    
Module    12    can    be    used    to    help    determine    how    to    build    an    income    statement.        
    
7. Should    we    throw    this    party?    Why    or    why    not?    Use    the    answers    to    the    preceding    questions    to    answer    this    
question,    supporting    your    reasoning    with    the    financial    information    collected.        
    

Microsoft Word - Financial Analysis Ru
ic.docx
Name:    Financial    Analysis    Ru
ic        
Description:    This    ru
ic    will    be    utilized    in    grading    Financial    Analysis    submissions        
    
         Does    not    meet    criteria     Meets    criteria     Exceptional    
Reasonable    
estimate    of    
Sales    Price    for    
Tickets    
Points:    
0    (0%)    
Student    does    not    
determine    the    sales    price    
for    a    ticket.    
Points:    
3    (3%)    
Includes    sales    price    but    it    does    
not    meet    the    majority    of    the    
"exceptional"    criteria.    
Points:    
5    (5%)    
Includes    reasonable    sales    price    using    strategies    
and    objectives    from    the    course,    citing    clearly    to    
the    course    material    and    illustrating    its    use.    Also    
esearches    at    least    3    competitors'    prices    as    a    
enchmark    for    pricing.    
Expenses    
clearly    
explained    in    
essay    
Points:    
0    (0%)    
Expenses    are    not    
explained    in    essay.    
Points:    
15    (15%)    
Student    makes    a    good    effort    
explaining    some    of    the    expenses    
presented    but    does    not    meet    the    
majority    of    the    "exceptional"    
criteria.    
Points:    
25    (25%)    
Each    cost    estimate    has    been    researched    with    
source    included    in    footnotes    throughout    and    all    
major    costs    are    identified    and    clear.    Any    
assumptions    are    identified    and    explained.    
Break    Even    
Analysis    
Properly    
Conducted    
Points:    
0    (0%)    
Student    does    not    
conduct    
eak-even    
analysis.    
Points:    
10    (10%)    
Break    even    analysis    is    conducted    
ut    is    not    accurate    and    does    not    
demonstrate    a    clear    
understanding    of    the    learning    
concept.    
Points:    
15    (15%)    
Break    even    conducted    co
ectly    to    determine    
units/services    needed    to    sell    year    one    to    
eak    
even    based    on    fixed    and    variable    expenses    and    
price    of    good/service    demonstrating    a    clear    
understanding    of    this    learning    concept.    
Location    
identified    and    
supported    with    
clear    reasoning    
Points:    
0    (0%)    
Student    does    not    identify    
and    support    with    clear    
easoning    a    location    and    
venue    in    Maryland.    
Points:    
3    (3%)    
Student    identifies    a    location    and    
venue    for    the    party    in    Maryland    
and    supports    it    with    some    data    to    
support    his/her    reasoning.    
Points:    
5    (5%)    
Student    identifies    a    location    and    venue    for    the    
party    in    Maryland    and    supports    it    clearly    with    
comprehensive    data    to    support    his/her    
easoning.    
Sales    
Projections    
(revenue)    
Points:    
0    (0%)    
Student    does    not    
complete    sales    
projection.    
Points:    
3    (3%)    
Student    projects    revenue    but    
ationale    is    not    clear.    
Points:    
5    (5%)    
Projected    revenues    supported    based    on    logical    
easoning    for    price    of    ticket    and    expected    sales    
and    explained    clearly    in    essay    using    projection    
methods    from    the    course.    
Income    
Statement    (not    
part    of    page    
limit)    
Points:    
0    (0%)    
Student    does    not    include    
income    statement.    
Points:    
5    (5%)    
Student    includes    income    
statement    for    first    year    of    
usiness    but    it    does    not    meet    the    
majority    of    the    "exceptional"    
criteria.    
Points:    
10    (10%)    
Income    statement    is    reasonable    in    its    projections    
of    sales    revenues,    identification    of    a    
comprehensive    and    complete    list    of    expenses,    
and    properly    calculates    net    profit/loss.    
Using    PICK    
Analysis,    uses    
course    
concepts,    
esearch    and    
data    to    support    
claims    as    
necessary,    
which    are    cited    
Points:    
0    (0%)    
Works    cited    are    not    
included.    Course    
concepts    are    not    applied    
using    PICK    Analysis.    
Points:    
8    (8%)    
Works    cited    are    included    but    are    
not    clearly    noted    in    footnotes    as    
equired.    Some    course    concepts    
are    applied.    
Points:    
15    (15%)    
Works    cited    are    included    and    are    clearly    noted    
using    footnotes    as    required.    Multiple    course    
concepts    are    applied    throughout    the    submissions    
using    PICK    Analysis.    
         Does    not    meet    criteria     Meets    criteria     Exceptional    
with    footnotes    
throughout    
Paper    free    of    
grammatical    
e
ors/typos    
Points:    
0    (0%)    
There    are    multiple    typos,    
formatting,    and/or    
grammar    issues    in    paper.    
Points:    
3    (3%)    
There    are    minor    typos,    
formatting,    and/or    grammar    
issues    in    paper.    
Points:    
5    (5%)    
There    are    not    typos,    formatting,    nor    grammar    
issues    in    paper.    
Paper    is    
organized    and    
has    clarity    
Points:    
0    (0%)    
Student    presents    
information    in    a    
disorganized    and    unclear    
manner,    making    it    
difficult    to    interpret    the    
information    put    forth.    
Points:    
3    (3%)    
The    paper    is    somewhat    clear    and    
concise,    but    not    consistently    
throughout    the    paper.    
Points:    
5    (5%)    
The    paper    is    clear    and    concise    consistently    
throughout    its    entirety,    and    is    well    organized.    
Meets    page    
equirements    
(2    full    pages,    
no    more    than    3    
excluding    
income    
statement)    
using    single    
spacing,    
1”margins    and    
12    point    font    
Points:    
0    (0%)    
There    are    less    than    2    
single    spaced    substantive    
pages    submitted.    
Points:    
5    (5%)    
At    least    2    and    no    more    than    3    
substantive    pages    submitted.    
However,    pages    lack    substantive    
information    sufficient    to    
comprise    the    2    page    requirement    
(e.g.,    large    pictures,    graphs,    
spacing    quotes    take    up    too    much    
space).    
Points:    
10    (10%)    
At    least    2    and    no    more    than    3    substantive    pages    
submitted.    Income    statement    is    not    included    in    
the    page    count.    
Submitted    
timely    via    
Blackboard    in    
.doc    or    .docx    
format    
Points:    
0    (0%)    
Not    submitted    in    co
ect    
format.    
Points:    
0    (0%)    
Per    the    syllabus,    there    may    be    up    
to    a    20%    grade    reduction    per    day    
for    late    submissions.    
Points:    
0    (0%)    
Submitted    before    required    deadline    and    in    
proper    format.    
    

Microsoft Word - Jazz Party FINAL Sample.doc
Anonymous 1
1. The cost of a ticket to my jazz party is $59.99. I came up with this price using two pricing
strategies. First I used the competitive pricing strategy, which is defined as reducing “the
emphasis on price competition by matching other firms’ prices” (Boone, p XXXXXXXXXXSecond, I used
the odd pricing strategy which is defined as a “pricing method using uneven amounts,” (Boone,
p. 419) so that consumers would be more likely to purchase a ticket because the cost seems less
than it actually is (Boone, p XXXXXXXXXXIn benchmarking the ticket prices of competitors, there are
several competitors to for this jazz party. One competitor would be the Bethesda Blues and Jazz
Supper Club which charges $20 to $50 depending on the musician for admission (“Music
Calendar”, n.d., p. 1). For the purposes of this paper, I will assume the average cost is $35 for
admission by taking the average of those two prices ($20+$50= $70/2= $35). It is important to
note that the admissions ticket does not include food or drink costs. Based on the menu available
on their website, Bethesda Blues and Jazz Supper Club charges approximately $11 for
appetizers, $28 for a main course and $10 for dessert (“Dining”, n.d., pp XXXXXXXXXXDrink prices were
unavailable. Another competitor would be the Blues Alley D.C. Jazz Club which charges $25 to
$45 depending on the musician for admission (“Events”, n.d., p. 1). For the purposes of this
paper, I will assume the average cost is $35 for admission by taking the average of those two
prices ($25+$45=$70/2=$35). Food and drink are not included in that price. Based on the menu
available on their website, Blues Alley D.C. charges roughly $9.50 for appetizers, $22 for a main
course and $7 for dessert (“Menu”, n.d., pp XXXXXXXXXXDrink pricing is not available. A third
competitor would be the Bohemian Caverns Jazz Club in D.C. which charges a standard $20
admission fee (“Tickets”, n.d., p. 1). Food and drink are not included in the admissions cost.
Based on the menu available on their site, they charge $8 for appetizers, $16 for main courses
and $5 for sides (“Menu”, n.d., pp XXXXXXXXXXPricing for desserts and drinks were not available.

We have several distinct competitive advantages that separate us from the competition
(Boone, p. 8). One competitive advantage is that we include food and a drink in our ticket price.
You don’t have to wo
y about additional expenses just pay your admission fee at the front door,
and you are all set for a great evening. Our second competitive advantage is that we are
competitively priced when you factor in both the cost of food and admission. Our three
competitors charge roughly $35, $35 and $20 for admission which averages out to $30 for
admission ($35+$35+$20=$90/3= $30). In addition, they charge extra for food including a main
course and a dessert which averages out to $33.50 ($22+$7=29 (Bethesda Blues and Jazz Supper
Club). $28+10=$38 (Blues Alley D.C. Jazz Club). So, $38+$29=$67. 67/2= $ XXXXXXXXXXI did not
include Bohemian Caverns Jazz Club for comparative food pricing since dessert pricing was not
available. I assumed that a non-alcoholic beverage would cost about $3 at these competitors. All
in all, $30 admissions + $3 non-alcoholic beverage + $33.50 including main course and dessert =
$66.50. So $59.99, our price, is $6 less than theirs so we are competitively priced since we cost
less than our competitors when you factor in food and beverages costs in addition to the
admissions price. Our third competitive advantage is where we are located. We are 1 block from
the Bethesda Metro Station, and there are 2 large parking garages within 1 block as well making
it extremely convenient for people to come.

2. My fixed costs are those costs that remain constant regardless of the number of people
who attend (Boone, p XXXXXXXXXXAn example would be the facility I am renting the Bethesda Round
House Theatre which is $350 an hour (“Facility Use”, n.d., p. 1). I plan for the jazz party to be
from 7-11 p.m. with the jazz band playing from 7:30-9 p.m. Then dinner from 9-10:30 p.m. and
Anonymous 2
the jazz band finale from 10:30-11 p.m. I believe I would need to rent the facility for at least 1
hour before and after the show to allow people to set up and cleanup. So my total cost would be
$350x6 hours which equals $2,100. In addition, I would need to buy a couple of cash registers to
process people’s payments at the door. I would have 3 cash registers to process people quickly. 3
egisters at $59.99 each would cost me a total of $ XXXXXXXXXXStaples, n.d., p. 1). I would pay 3
people minimum wage, which is $8.40 an hour in Montgomery County according to the state of
Maryland’s DLLR, to man the registers for 1.5 hours (“Minimum Wage”, 2015, p. 1). I don’t
elieve I would have much difficulty finding three people who would work for 1.5 hours at $8.40
an hour because of the location of my party. Bethesda Round House Theatre is located 1 block
from the Bethesda-Chevy Chase High School, and I think three high school students would
eagerly work 1.5 hours to earn some money. They could take that money to go to a movie in
downtown Bethesda or go out to Chipotle for dinner afterwards. I would also hire 3 off duty
Montgomery County Police Officers to watch the cash registers, but also to act as security if
need be. Based on my personal knowledge, I know officers make time and a half for off-duty
work so given that an officer makes $48,981 a year and then divide that by 52 weeks in a year
and then divide that by 40 hours a week you get a hourly rate of $23.55 (Montgomery County
Police, n.d., p. 1). At time and a half it would cost $35.33 an hour per officer. I would hire 3
officers for 5 hours each so my cost would be $529.95 ($35.33x5x3=$ XXXXXXXXXXA band costs
approximately $750-$1500 for a four hour time slot (Sam Hill Entertainment, n.d., p. 1) For the
purposes of this paper, I will assume the average cost is $1,125 for the band by taking the
average of those two prices ($750+$1500=$2,250/2=$1,125). I am also allocating $1,000 for
various types of advertisements and decorations.

Table 1:
Fixed Costs Hourly
Rate/Cost
Quantity (how
many people)
Duration
(hours)
Total Cost
Rent Facility $ XXXXXXXXXX $2,100.00
Off-duty Police
Officers
$ XXXXXXXXXX $529.95
Cashiers $ XXXXXXXXXX $37.80
Cash Register $ XXXXXXXXXXN/A $179.97
Band $1, XXXXXXXXXXcontract min) $1,125.00
Advertising
and
Decorations
$1, XXXXXXXXXXN/A $1,000.00
Total Fixed
Costs:
4,972.72
Anonymous 3
My variable costs are those cost that vary depending on the number of people that attend
(Boone, p XXXXXXXXXXI would use Gist Family Catering which charges $18.50-$20 per person so I will
assume the average cost per person would be $19.25 ($18.50+$20=$38.50/2=$19.25) (“Lunch
and Dinner Menu,” n.d., pp.1-3). So assuming I sell 400 tickets, $19.25x400 would be $7,700.
This per person price includes a drink (punch), several main courses to choose from along with
several sides, dessert and paperware (“Lunch and Dinner Menu,” n.d., pp.1-3). Each server is
$110.00 for up to 5 hours (“Lunch and Dinner Menu,” n.d., pp.1-3). Based on internet research,
you generally need 1 server per 20 people (A Tasteful Affair, n.d., p. 1). So if I have 400 people
attending, I need 20 servers which would cost $2, XXXXXXXXXX/20=20) ($110x20=$2,200). I would
also need tables and chairs. A 72” round table sits approximately 11 people and costs $14.20 to
ent each table, and each chair costs $1.45 (A to Z Party Rental, n.d., p. 1). So assuming 400
guests, 400 chairs would cost me $580.00 and since a table costs $1.29 per person it would cost
me $516.00 ($1.45x400=$580. $14.20/11=$1.29 per person for a table. $1.29x400=$516)

Table 2:
Variable Costs Per person
Cost
Quantity Total Cost
Food and
Drink
$ XXXXXXXXXX $7,700.00
Servers $ XXXXXXXXXX $2,200.00
Chairs $ XXXXXXXXXX $580.00
Round Tables $ XXXXXXXXXX $516.00
Total Variable
Costs
10,996.00

3. A
eakeven analysis is used “to determine the minimum sales volume a product must
generate at a certain price level to cover all costs” (Boone, p XXXXXXXXXXBreak even= fixed costs/(avg
sale price per unit- avg variable cost). My fixed costs are $4,972 please see table 1 and table 2 at
above for a detailed
eak down. My avg sale price per unit is the price I am charging for a ticket
$59.99. The avg variable cost is $27.49 based on dividing my total variable costs $10,996 by the
number of people attending, 400. So $10,996/400= $27.49. Please see table 2 for a detailed
eak
down. Therefore, I need to sell 154 tickets to
eakeven. 4,972.72/ XXXXXXXXXX)= XXXXXXXXXX→
154
Answered 5 days After Apr 29, 2024

Solution

Sandeep answered on May 05 2024
8 Votes
Sheet1
        Table 1:    Projected Revenue
            Price Each    Number of    Projected
            Ticket    Tickets of Sold    Revenue
        Potential Sales     $ 76.89    1000    $ 76,890.00
        Table 2 :     Cost of Goods Sold/Variable Expenses
        Variable Costs    Per person    Quantity    Total Cost
            Cost
        Food and Drink    $ 20.50    1000    $ 20,500.00
        Servers    $ 115.00    15    $ 1,725.00
        Chairs    $ 1.05    1000    $ 1,050.00
        Round Tables    $ 1.35    1000    $ 1,350.00
        Total Variable cost    $ 137.90        $ 24,625.00
        avg....
SOLUTION.PDF

Answer To This Question Is Available To Download