Reference no: EM133019192

Assuming that an aspiring entrepreneur wants to set up a new business. To be able to help him to analyze the feasibility of his business. The following figures are gathered:

The monthly rental of the place is P15,000. He estimated that the potential of the location would be 150 units of the product per day (assuming there are 26 days a month). Furthermore, he considred to hire 2 crews amouting to 8,000 of salary each. Furthermore, the utilities is estimated to be 2,000 per month.

Production costs are estimated as follows: Each unit's variable cost is P20.00. He plans to sell the product at P38.00 each.

Required:

1. What is his Break even point per month?

2. Assuming that his investment should earn at least P15,000 per month. Will this venture be feasible?

3. Assuming that the rental would increased by 25% on the following year. Will the venture would still be feasible?

4.. If he targets P30,000 of profit each month, how many units shall he sell?

5. If prices of inputs increase by 20%, What would be his new break even point?

6. If salary is increased by 1,000 per crew. What would be his new break even point?