International Business
* a. Choose the income statement of particular year.
* b. Split up costs in fixed and variable the best you can.
* c. Look for an average price per motor bike to determine how many bikes Envy Rides has sold.
* d. Calculate the variable cost per cycle sold, and assume it is constant.
* e. Draw graph with MC-curve (at the level of the variable cost per cycle), and the average total costs curve.
* f. Be sure to have number of cycles sold on the horizontal axis.
Income statement for the year 2009
Variable costs: * Salaries C$ 323,966 * Advertising and promotion C$ 53,424 * Automotive C$ 26,129 * Telephone C$ 10,750 * -------------------------------------------------
Office expense C$ 12,270
Total variable costs C$ 426,539
Fixed costs: * Rent and utilities C$96,900 * Insurance C$7,258 * License fees and dues C$12,583 * Professional fees C$2,192 * Bank charges and interest C$55,298 * Amortization C$19,000
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Total fixed costs C$193,231
Total costs C$ 619,770 Average price per motorcycle: 2013 Yamaha YZF-R6 : C$ 11,999.00 for both competitors We are also use this price, so the average price per motorcycle is set on C$11,999.00 The sales were C$3,613,959.00 So, C$3,613,959.00/ C$11,999.00 = 301,188 rounded to 301 motorcycles Variable costs per motorcycle: C$ 426,539/301 = C$ 1,417.07 So variable costs per motorcycle were C$ 1,417.07 C$ 619,770/ 301 = C$ 2,059.04
References: Prices of the motorcycles, Yamaha
* b. Split up costs in fixed and variable the best you can.
* c. Look for an average price per motor bike to determine how many bikes Envy Rides has sold.
* d. Calculate the variable cost per cycle sold, and assume it is constant.
* e. Draw graph with MC-curve (at the level of the variable cost per cycle), and the average total costs curve.
* f. Be sure to have number of cycles sold on the horizontal axis.
Income statement for the year 2009
Variable costs: * Salaries C$ 323,966 * Advertising and promotion C$ 53,424 * Automotive C$ 26,129 * Telephone C$ 10,750 * -------------------------------------------------
Office expense C$ 12,270
Total variable costs C$ 426,539
Fixed costs: * Rent and utilities C$96,900 * Insurance C$7,258 * License fees and dues C$12,583 * Professional fees C$2,192 * Bank charges and interest C$55,298 * Amortization C$19,000
-------------------------------------------------
Total fixed costs C$193,231
Total costs C$ 619,770 Average price per motorcycle: 2013 Yamaha YZF-R6 : C$ 11,999.00 for both competitors We are also use this price, so the average price per motorcycle is set on C$11,999.00 The sales were C$3,613,959.00 So, C$3,613,959.00/ C$11,999.00 = 301,188 rounded to 301 motorcycles Variable costs per motorcycle: C$ 426,539/301 = C$ 1,417.07 So variable costs per motorcycle were C$ 1,417.07 C$ 619,770/ 301 = C$ 2,059.04
References: Prices of the motorcycles, Yamaha
References: Prices of the motorcycles, Yamaha YZF-R6 2013 http://www.kahunapowersports.com/new_vehicle_detail.asp?sid=06715357X3K12K2013J1I14I36JPMQ3746R0&veh=320614&CatDesc=Motorcycles&ModelYear=2013 (Accessed : 8th March 2013) http://www.snowcity.com/new_vehicle_detail.asp?sid=05463373X3K12K2013J1I09I49JPMQ2979R0&veh=320402&pov=2973395 (Accessed: 8th March 2013)