Homework SourseUsing the 2009 Budget Money is given in Canadian dollars pre
Using the 2009 Budget (Money is given in Canadian dollars), prepare a break even analysis to find:
1. At what trip fee does JUDES break even on the trips?
2. At what participant level does JUDES break even on the trips?
Please show all formulas and calculations so I can follow along and learn how to apply the concepts for the future.
EXHIBIT 1
| EXHIBIT 1 | |
| JUDES BUDGET 2009 - PER TRIP | |
| Chayotepec Trip 2009 | |
| COST OF GOODS | Grand Total (C$) |
| Ground Transportation & Guiding | |
| Driver (including tip) | $ 1,649.25 |
| Van gas | $ 350.00 |
| Road tolls | $ 50.00 |
| Local Guide | $ 300.00 |
| Total Ground Transportation & Guiding | $ 2,349.25 |
| JUDES costs (Promotion and Administrative) | |
| Director flight costs (1 trip; only return) | $ 1,300.00 |
| Director travel insurance | $ 200.00 |
| Internet Access in Mexico | $ 20.00 |
| Promotion (1.8 page ad x 4 weeks) | $ 1,000.00 |
| Long distance telephone costs | $ 100.00 |
| Mexican Cell Phone | $ 30.00 |
| Living in Mexico for 5 days | $ 300.00 |
| Cell phone calls in Mexico | $ 100.00 |
| Misc medical supplies | $ 250.00 |
| Liability insurance | $ 500.00 |
| Bank account & bank charges (Visa electron) | $ 300.00 |
| Total JUDES\' Costs | $ 4,100.00 |
| Food & Accomodation Costs & Activity Costs | |
| Saturday / Oaxaca | |
| Hotel Azucenas | $ 492.50 |
| Dinner in Oaxaca | $ 118.20 |
| Sunday / Oaxaca | |
| Breakfast - Hotel Azucenas | $ 43.34 |
| Museo de las Culturas | $ 52.01 |
| Lunch - Oaxaca | $ 75.85 |
| Monte Alban | $ 59.10 |
| Dinner in Oaxaca | $ 130.02 |
| Hotel Azucenas | $ 270.88 |
| Monday / Cooperativa | |
| Hotel Azucenas (1 breakfast) | $ 52.01 |
| Hiereve El Agua | $ 17.73 |
| El Tule | $ 41.37 |
| Lunch at Alice\'s | $ 41.37 |
| Cooperativa (1 night) + dinner | $ 236.40 |
| Tuesday / Travel to Chayotepec | |
| Cooperativa breakfast | $ 59.10 |
| Lunch on the way | $ 41.37 |
| Interpretation trail access fee | $ 59.10 |
| Dinner in Chayotepec | $ 70.92 |
| Chayotepec - night 1 | $ 88.65 |
| Honorarium for families | $ 9.85 |
| Wednesday / Coffee Harvesting | |
| Chayotepec - breakfast | $ 70.92 |
| Chayotepec - lunch | $ 94.56 |
| Chayotepec - dinner | $ 70.92 |
| Chayotepec - night 2 | $ 88.65 |
| Honorarium for families | $ 9.85 |
| Thursday / Tortilla Making & Walks | |
| Chayotepec - breakfast | $ 70.92 |
| Interpretation trail access fee | $ 59.10 |
| Chayotepec - lunch | $ 94.56 |
| Chayotepec - dinner | $ 70.92 |
| Chayotepec - night 3 | $ 88.65 |
| Honorarium for families | $ 9.85 |
| Chayotepec 4 hr guided walk (2 guides) | $ 47.28 |
| Friday / Porvenir | |
| Chayotepec - breakfat | $ 70.92 |
| Lunch in Porvenir | $ 53.19 |
| Dinner in Juchitan | $ 118.20 |
| Juchitan - 1 night (3 ppl - 1 room) | $ 295.50 |
| Saturday / Juchitan | |
| Breakfast - Juchitan | $ 53.19 |
| Lunch - Juchitan | $ 94.56 |
| Dinner at Playa Azul | $ 141.84 |
| Playa Azul - 1 night | $ 236.40 |
| Sunday / Travel to Oaxaca | |
| Breakfast - Playa Azul | $ 53.19 |
| Lunch on the way | $ 47.28 |
| Honoraria for Chayotepec families | |
| Musician | $ 59.10 |
| Mid-wife / healer | $ 9.85 |
| Medicinal | $ 9.85 |
| Walk at Porvenir | $ 9.85 |
| Storytelling | $ 9.85 |
| Total Food & Accomodation Costs & Activity Costs | $ 3,998.71 |
| Sustainability Fee (C$130 per person) | $ 1,300.00 |
| Reciprocity Fund (C$50 per person) | $ 500.00 |
| JUDES fund (C$250 per person) | $ 2,500.00 |
| Total | $ 14,747.96 |
| Total Cost per person | $ 1,474.80 |
Solution
The Breakeven Formula: How to Do a Breakeven Analysis
This is fairly simple. To conduct your breakeven analysis, take your fixed costs divided by your price minus your variable costs. As an equation, this is defined as:
Breakeven Point = Fixed Costs/(Unit Selling Price - Variable Costs)
This calculation will clearly show you how many units of a product you must sell in order to break even. You\'ve recovered all costs associated with producing your product, both variable and fixed, when you\'ve reached this point.
Every additional unit sold after this increases profit by the amount of the unit contribution margin, which is defined as the amount each unit contributes to covering fixed costs and increasing profits. This is defined as an equation as:
Unit Contribution Margin = Sales Price - Variable Costs
Sales information is not given and please provide us sales information so that we can solve the answer.
