Business Analytics: Mathematical Model, Analysis, and Break-even Analysis

Business Analytic

Contents
INTRODUCTION...........................................................................................................................3
Question 1........................................................................................................................................3
Mathematical Model:...................................................................................................................3
Calculate the profit or loss for BF Ltd:........................................................................................3
Draw a graph with a spreadsheet:................................................................................................4
Question 2........................................................................................................................................6
Correlation coefficient of advertising/sales and comment:..........................................................6
Analysis:.......................................................................................................................................7
Question 3........................................................................................................................................7
Determine:....................................................................................................................................7
When company’s target profit for the year is £56000:................................................................8
Break even chart:.........................................................................................................................8
Critically analyse the benefits and limitations of the breakeven model:.....................................9
CONCLUSION..............................................................................................................................10
References......................................................................................................................................11

INTRODUCTION
Business Analytics relates to a procedure in which organisations use computational tools
and technology to analyse historical/past data in attempt to obtain new insights and enhance
strategic decision-making. Business Analytics is an iterative, methodological study of data of the
enterprise, with a focus on mathematical analysis. Company intelligence is used by businesses
that employ data-driven decision-makings (Evans, 2017). Data-driven businesses regard their
data as corporate commodity and aggressively pursue opportunities to transform it
into competitive advantage. Effective business analytics relies on data accuracy, on trained
analysts who understand technology and business, as well as on an organisational willingness to
use data to generate insights which inform strategic decisions. The study consists of different
aspects of business analytics through different practical tasks along with critical analysis of
results.
Question 1
Mathematical Model:
Sales Variable costs Profit
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Mathematical Model
Calculate the profit or loss for BF Ltd:
Budgeted
annual
120000
units

output
Fixed cost 40000
Variable
costs
0.5
Sales price 1
Units Rate Amounts
Sales 120000 1 120000
Less: Variable
costs
120000 0.5 60000
Contribution [Sales less variable
costs}
60000
Less: Fixed costs 40000
Profit 20000
Draw a graph with a spreadsheet:
Units Rate Year
2021
Year
2022
Year
2023
Year
2024
Year
2025
Year
2026
Sales 12000
0
1 12000
0
12600
0
13230
0
13891
5
145860.
8
153153.
8
Less: Variable
costs
12000
0
0.5 60000 66000 72600 79860 87846 96630.6
Contribution 60000 60000 59700 59055 58014.7
5
56523.1
9
Less: Fixed costs 40000 40000 40000 40000 40000 40000
Profit 20000 20000 19700 19055 18014.7
5
16523.1
9