Accounting in Business

Running head: ACCOUNTING IN BUSINESS
Accounting in Business
Name of the Students:
Name of the University:
Author’s Notes:

1ACCOUNTING IN BUSINESS
Table of Contents
1. Computation of Breakeven point:..........................................................................................2
2. Fixed and variable costs:........................................................................................................3
3. Relationship between contribution margin and Variable costs:.............................................3
4. Limitations of the data:..........................................................................................................3
5. Data missing from the case:...................................................................................................4
References and bibliography:.....................................................................................................5

2ACCOUNTING IN BUSINESS
1. Computation of Breakeven point:
Revenue per event:
Total Revenue from services 2,25,00,000
Number of services provided 5,000
Revenue per service (22500/5000) 4,500
Variable cost per service:
Floral cost per event 200
Table arrangement costs 100
Soft Drinks and children snacks 500
Wages of temporary staffs 1,800
Total Variable Costs per event 2,600
Fixed Costs:
Annual costs of tents and structures 5,00,000
Annual costs of trucks and vehicles 20,00,000
Annual staff costs 35,00,000
Total Annual Fixed costs 60,00,000
Contribution margin:
Revenue per event 4,500
Less: Variable costs per event 2,600
Contribution margin per event 1,900
Breakeven point in number of events (6000000/1900) 3,158
Breakeven point in amount (3158*4500) 1,42,11,000