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You have been asked by the Board of Directors to carry out Cost Volume Profit analysis on your business' Year 3 results. a) Calculate your business' break-even quantity (in pallets) for Year 3. You should show all relevant workings and clearly state any assumptions you have made. b) In the DrinkSim business simulation there are three physical distribution options: Option 1: Mid: A variable cost of W\$37 per pallet Option 2: High variable cost: A fixed cost of W\$300,000 plus a variable cost of W$25 per pallet Option 3: High fixed cost: A fixed cost of W\$1,000,000 plus a variable cost W$10 per pallet Based on your business' actual sales volume in Year 3, calculate the total Distribution Cost for each of the above options. You should present the results of your calculations in a format which you consider to be most useful for management purposes. Nissmids A 'green tax' of 20 ss is to be levied frem Year 4 en all drieis that de not use re-cyclable packagine Mainline retailers are ramoured to be launching an ewo label Natural Sweet drink. Team 1 Drinks Co. 1 Year 3 SFATEMENT OF POHI OR IOSS. SIAIEMENT OS FINANCHAL POSTIOH. Man Years completed on 2nd R\&D project: 125 s Co. 1 Year 3 CUSTOMER \& CONSUMER ProductQualityConsumerSatisfaction78 BrandImageBrandAwareness(%)PublicImage6246 DEMAND Unit Sales 34149 Lost Sales 0 Contract Sales 3000 A 'green tax' of 20% is to be levied from Year 40 Mainline retailers are rumoured to be launching STATEMENT OF PROFI OR LOSS STATEMENT OF CASH FLOWS OperatingprofitAdd:DepreciationAdd:AmortisationChangeinworkingcapital:1.Inventorychange2.Receivableschange3.Prepaymentschange4.Payableschange5.Accrualschange6.ProvisionschangeTotalchangeinworkingcapitalCashgeneratedfromoperationsInterestreceivedInterestpaidTaxpaidNetcashflowfromoperationsPurchaseofPP&EPurchaseofintangibleassetsNetcashflowfrominvestingProceedsfromshareissueDrawdown(repayment)ofloanDividendpaidNetcashflowfromfinancingNetcashflowfortheyear2872.75+725+461.25+95016606100+723+4782+011071+46015001537.52037.5+0449449+2114.5 Year 3 STATEMENT OF FINANCIAL. POSIIION KEY FINANCIAL METRICS AND RATIOS ReturnonCapitalEmployed(%)ReturnonNetAssets(%)OperatingMargin(%)GrossMargin(%)OperatingExpensestoSales(%)RevenueonCapitalEmployed(WS)RevenueonNon-CurrentAssets(WS)RevenueonWorkingCapital(WS)CurrentRatioAcid-TestRatioInventoryDaysReceivablesDaysPayablesDaysGearing(%)InterestCoverEBITDA(WS000)65.346.021.458.637.13.055.496.841.771.54386510411.426.1+4059 You have been asked by the Board of Directors to carry out Cost Volume Profit analysis on your business' Year 3 results. a) Calculate your business' break-even quantity (in pallets) for Year 3. You should show all relevant workings and clearly state any assumptions you have made. b) In the DrinkSim business simulation there are three physical distribution options: Option 1: Mid: A variable cost of W\$37 per pallet Option 2: High variable cost: A fixed cost of W\$300,000 plus a variable cost of W$25 per pallet Option 3: High fixed cost: A fixed cost of W\$1,000,000 plus a variable cost W$10 per pallet Based on your business' actual sales volume in Year 3, calculate the total Distribution Cost for each of the above options. You should present the results of your calculations in a format which you consider to be most useful for management purposes. Nissmids A 'green tax' of 20 ss is to be levied frem Year 4 en all drieis that de not use re-cyclable packagine Mainline retailers are ramoured to be launching an ewo label Natural Sweet drink. Team 1 Drinks Co. 1 Year 3 SFATEMENT OF POHI OR IOSS. SIAIEMENT OS FINANCHAL POSTIOH. Man Years completed on 2nd R\&D project: 125 s Co. 1 Year 3 CUSTOMER \& CONSUMER ProductQualityConsumerSatisfaction78 BrandImageBrandAwareness(%)PublicImage6246 DEMAND Unit Sales 34149 Lost Sales 0 Contract Sales 3000 A 'green tax' of 20% is to be levied from Year 40 Mainline retailers are rumoured to be launching STATEMENT OF PROFI OR LOSS STATEMENT OF CASH FLOWS OperatingprofitAdd:DepreciationAdd:AmortisationChangeinworkingcapital:1.Inventorychange2.Receivableschange3.Prepaymentschange4.Payableschange5.Accrualschange6.ProvisionschangeTotalchangeinworkingcapitalCashgeneratedfromoperationsInterestreceivedInterestpaidTaxpaidNetcashflowfromoperationsPurchaseofPP&EPurchaseofintangibleassetsNetcashflowfrominvestingProceedsfromshareissueDrawdown(repayment)ofloanDividendpaidNetcashflowfromfinancingNetcashflowfortheyear2872.75+725+461.25+95016606100+723+4782+011071+46015001537.52037.5+0449449+2114.5 Year 3 STATEMENT OF FINANCIAL. POSIIION KEY FINANCIAL METRICS AND RATIOS ReturnonCapitalEmployed(%)ReturnonNetAssets(%)OperatingMargin(%)GrossMargin(%)OperatingExpensestoSales(%)RevenueonCapitalEmployed(WS)RevenueonNon-CurrentAssets(WS)RevenueonWorkingCapital(WS)CurrentRatioAcid-TestRatioInventoryDaysReceivablesDaysPayablesDaysGearing(%)InterestCoverEBITDA(WS000)65.346.021.458.637.13.055.496.841.771.54386510411.426.1+4059

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