ACCM 4100 : Management Accounting - Construct a Cost-Volume-Profit Analysis - Accounting Assignment Help

Assignment Task :

Assessment Description 

Learning Outcome 1: Formulate budgets and construct a cost-volume-profit analysis using practical scenarios 

Objective: The objective of this assignment is to effectively use spreadsheet software to provide cost- volume-profit analysis 

Required: 

The assignment will need to be submitted electronically on the portal, via the moodle site. 

Please make sure you follow the guidelines noted in your subject outline especially those relating to the presentation of written work, late assignment policy and academic integrity. 

CASE STUDY USING EXCEL SPREADSHEET 

You work for Theo Walcott Tours Ltd which provide tourists and visitors with ‘experiences’ of Perth and its surrounds. Your manager is currently investigating introducing another product, which are ‘Luxury’ helicopter rides over beautiful bushland. Each trip would be 50km in total. 

Your manager wants you to use cost-volume-profit analysis in order to help assess the plan’s feasibility. 

She provides you with the following estimated data: 

Selling price per trip: $600 (total for 3 customers – trips only run with 3 customers) 

REQUIRED: Calculate the following: 

1) The Break-even point in trips per month (4 Marks) 

2) The Break-even point in dollars of revenue per month (2 Marks) 

3) Assuming a profit after tax requirement from the Helicopter trip business of $120,000 per year 

and a tax rate of 30%, calculate: 

a) Trips required per month to obtain target profit (4 Marks) b) Revenue required per month to obtain target profit  

Your manager has requested that the spreadsheet is easy to use for ‘What-if’ analysis – so she would like to be able to change some of the inputs to see the impact on the calculations above – for example, if the Helicopter were able to be rented more cheaply or the selling price was increased. 

Hence 3 Marks are allocated to ease of use and accuracy for ‘what-if’ analysis (which will also depend on the formulas used) 

1) Answering briefly in words in excel, include some notes to your manager explaining the limitations of your analysis and the assumptions included in it.

2 marks are allocated for the general presentation of the spreadsheet. 

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