Posted: March 17th, 2017
Provide a list of the assumptions upon which you are basing your revenue and cost figures.
You have developed a footwear product, which you believe could revolutionize the footwear market.
Following on from the Dragon’s Den success of Levi Root’s Reggae Reggae Sauce – (search the internet if you are unfamiliar with this story), you have decided to make a pitch to a small group of potential investors.
You know that any potential investor will expect you to have a good knowledge of how much your product will cost to produce and also of the expected level of sales and profit your product is predicted to make.
- Provide a list of the assumptions upon which you are basing your revenue and cost figures. 5 marks
- Prepare a marginal costing cost statement for your product on a ‘per unit’ and 12 months sales/production basis. 10 marks
- Produce a break-even analysis (table and graph) for your product based on 12 months activity 15 marks
- Produce the following financial documents for the first 12 months of trading:
- Cash Budget 20 marks
- Forecast Income Statement 10 marks
- Forecast Balance Sheet 10 marks
- Write a 1,000 word ‘pitch’ explaining the costing and financial data from tasks 1-4 above, to your potential investors. 30 marks