Financial Analysis of Project(6)

Break Even Analysis

FIXED COST

Salaries 5.55 5.83 6.12 6.42 6.75 7.08 7.44 7.81
Repair & Maintenance 0.07 0.07 0.07 0.08 0.08 0.08 0.08 0.08
Insurance 0.60 0.66 0.73 0.80 0.88 0.97 1.06 1.17
Administrative expenses 0.94 1.03 1.14 1.25 1.38 1.51 1.67 1.83
Depreciation 0.64 0.57 0.52 0.47 0.42 0.38 0.34 0.31
Interest on MM loan
Interest on Term loan 0.73 0.57 0.32 0.08 0.00 0.00 0.00 0.00
Total 8.53 8.73 8.90 9.10 9.50 10.02 10.59 11.20

VARIABLE COST

Raw Materials 26.42 27.18 27.93 28.69 29.44 30.20 30.95 31.71
Wages 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Power Charges 1.09 1.12 1.15 1.18 1.21 1.24 1.27 1.30
Selling expenses 0.07 0.07 0.07 0.08 0.08 0.08 0.08 0.08
Interest on WC loan 0.35 0.35 0.35 0.35 0.35 0.35 0.35 0.35
Total 27.93 28.72 29.50 30.29 31.08 31.87 32.66 33.44

Break Even Point And Ratio Analysis

Particulars 1st Year 2nd Year 3rd Year 4th Year 5th Year 6th Year 7th Year 8th Year
Fixed Cost 8.53 8.73 8.90 9.10 9.50 10.02 10.59 11.20
Variable Cost 27.93 28.72 29.50 30.29 31.08 31.87 32.66 33.44
Total Cost 36.46 37.45 38.40 39.39 40.58 41.89 43.24 44.64
Sales 41.34 42.53 43.71 44.89 46.07 47.25 48.43 49.61
Contribution (Sales -VC) 13.42 13.81 14.20 14.59 14.99 15.38 15.77 16.17
B.E.P in % =(FC/Contribution) 64% 63% 63% 62% 63% 65% 67% 69%
Break Even Sales =(BEP*Sale) 26.28 26.90 27.38 27.98 29.19 30.78 32.50 34.37

Break Even Units in quantity

 500536 498135 493360 490851 499030 513041 528531 545521
Current Ratio 2.88 4.58 6.38 8.74 11.36 13.94 16.49 18.99

Net Profit Ratio = (Net Profit/Sales)

 13% 13% 13% 14% 14% 13% 13% 12%