Budgeting Exercise 03
Budgeting Exercise 03
Budgeting Exercise 03
Case A
In this simple problem your task is to work out the number of
participants required to ensure the event breaks-even.
The data you need to make your calculation is as follows:
Total Fixed Costs: $10,080
Variable Cost per Participant: $2.00
Ticket Price per Participant: $20
Income
No. of Ticket Total
Participants Price Income
Guests 560 20 11200
Expenditure
No. of Cost per
Participants Participant Total
Variable Costs 560 2 1120
Profit 0
620216158.xlsx, 10/20/2022
Budgeting Exercise 3
Working Out the Break Even Point (Case B)
Case B
This problem is much the same problem as in Case A except that you are given the number
of participants and you must work out what is the minimum price that spectators must be
charged.
The data you need to make your calculation is as follows:
Total Fixed Costs: $10,000
Variable Cost per Participant: $5.00
Number of Participants Required: 500
Income
No. of Ticket Total
Participants Price Income
Guests 500 25 12500
Expenditure
No. of Cost per
Participants Participant Total
Variable Costs 500 5 2500
Profit 0
620216158.xlsx, 10/20/2022
Budgeting Exercise 3
Working Out the Break Even Point (Case C)
Case C
The club committee are putting on an awards evening in the clubhouse. The ticket
price will be $30 per person and it is expected that 100 people will attend.
The committee will spend $1500 on entertainment and prizes.
What is the maximum cost of the meal per person that can be afforded, if the
event is not to make a loss.
Income
No. of Ticket Total
People Price Income
Guests 100 30 3000
Expenditure
Variable Costs
Guests 100
Cost of Food per Guests 15
Profit 0
620216158.xlsx, 10/20/2022
Budgeting Exercise 3
Working Out the Break Even Point (Case C)
620216158.xlsx, 10/20/2022
Budgeting Exercise 3
Working Out the Break Even Point (Case D)
Case D
The committee of a sport organisation is considering three different venues to stage a major fundraising event. Venue A has a maximum seating
capacity of 500 people and costs $1,200 to hire. Venue B has a maximum capacity of 1000 and costs $3,500 and Venue C has a maximum capacity of
2000 and costs $9,000. If the variable cost for each participant is $5.20, which venue would be the most profitable at maxmum capacity.
Venue A - max 500 seats Venue B - max 1000 seats Venue C - max 2000 seats
Income Income Income
No. of Ticket Total No. of Ticket Total No. of Ticket Total
Spectators Price Income Spectators Price Income Spectators Price Income
Guests 500 10 5000 Guests 1000 10 10000 Guests 2000 10 20000
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Budgeting Exercise 3
Working Out the Break Even Point (Case E)
Case E
Total Fixed Costs: $20,000
Variable Cost per Participant: $2.00
Ticket Price for accompanied children: $5
Ticket Price for adults: $20
Expected Ratio: 2 Adults to every 1 child
Income
No. of Ticket Total
People Price Income
Children 512.82 5 2564.1
Adults 1025.64 20 20512.8
Expenditure
Variable Costs
Total Spectators 1538.46
Variable Cost per Spectator 2
Profit -0.02
620216158.xlsx, 10/20/2022
Budgeting Exercise 3
Working Out the Break-Even Point (Case F)
Case F
Income
Total Spectators 25000
Spectator Ticket Price 15
Expenditure
Variable Costs
Total Spectators 25000
Variable Cost per Spectator 3
Fixed Costs
Fixed Cost (Level 1) - Spectators 20,000 or less 200000
Fixed Cost (Level 2) - Spectators over 20,000 300000
Profit 0
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