BUS1AFB Accounting And Finance For Business Individual Assignment

Question 2 (5 marks)

Given you are constrained to your house due to Covid-19, you have decided to try and launch your own small business.

Required (approximately 350 words):

a) Design a small business and document one key product that you are selling. Name your business and product with a brief description of its purpose. In a table (please use the one below) list a maximum of ten costs that will be involved in selling your product and explain why they are either a variable or fixed cost and their unit value.
b) Estimate a reasonable selling price per unit for your product with an explanation as to how you determined your selling price.
c) Using your figures calculate your Breakeven point, in both units and dollars ($) showing all calculations.
d) State whether you require a profit of either $5,000, $15,000 or $30,000 and then calculate your new breakeven point, in both units and dollars ($) showing all calculations. Note: only select one required profit.
e) Define and calculate the ‘Margin of Safety’, in both units and dollars, assuming you sell 35,000 units. Ensure you include all calculations.

An example of a Business could be “Keep your pets happy” with your specialty being chew toys for your dog delivered to your door. Your product is “Chewy the bone” and some example costs are purchasing two parts to make the toy, electricity to run your business in your shed, internet to be able to take your orders, petrol costs to run your car for delivery.
Please keep this reasonably simple to demonstrate your knowledge. I do realise there are many more costs involved but you do not need to list everyone, up to ten is what I am looking for to maximise your mark.