2.2 Financial Planning 0.0 / 5 ? Business StudiesFinancial PlanningASEdexcel Created by: tomstodd23Created on: 02-05-18 10:24 Sales Forecasting A prediction of future sales within a given time period. 1 of 12 Why do companies create sales forecasts? Profit projections; help create budgets; staff performance targets; Stock listings etc 2 of 12 Factors that influence sales forecasts Seasonal trends; Consumer trends; Competition; Economic trends 3 of 12 Contribution Sales Revenue- Variable Costs 4 of 12 Unit Contribution Selling Price- Unit Variable Cost 5 of 12 Axis of Break Even Chart Costs/Revenues and Output 6 of 12 Factors Measured on a Break Even Chart Total Revenue, Total Costs, Fixed Costs and Breakeven Point. 7 of 12 Margin of Safety Actual Output- Breakeven Output 8 of 12 Margin of Safety Profit Formula Margin of Safety x Unit Contribution= Profit 9 of 12 Breakeven Profit Target Formula Fixed Costs + Target Profit/ Unit Contribution 10 of 12 Breakeven The level of sales/output where you are neither making a profit or loss. 11 of 12 Breakeven Output Formula Fixed Costs/ Unit Contribution 12 of 12
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