You are on page 1of 10

Green Paradise Golf Course and Shop

Break-even Analysis for Golf Lessons


Revenue
Total Clients 70
Golf Lesson Fee $125.00 10
Gross Revenue $8,750.00 20
Expenses 30

Client Demand
Fixed Costs 40
Manager Salaries $4,669.00 50
Utilities $427.00 60
Equipment Depreciation $1,122.00 70
Insurance $328.00 80
Total Fixed Costs $6,546.00 90
Variable Costs 100
Instructor Commission 10% $875.00
Supplies per Client $9.95 $696.50
Total Variable Costs $1,571.50
Total Expenses $8,117.50
Net Income $632.50
d Shop
ns
Expenses Revenue Net Income

$ 6,771 $ 1,250 $ (5,521)


$ 6,995 $ 2,500 $ (4,495)
$ 7,220 $ 3,750 $ (3,470)
$ 7,444 $ 5,000 $ (2,444)
$ 7,669 $ 6,250 $ (1,419)
$ 7,893 $ 7,500 $ (393)
$ 8,118 $ 8,750 $ 633
$ 8,342 $ 10,000 $ 1,658
$ 8,567 $ 11,250 $ 2,684
$ 8,791 $ 12,500 $ 3,709
Golf Lesson Pricing Two-Variable Data Table
Total Clients 75 Lesson Prices
Lesson Fee $150.00 120 125 130 135
Gross Revenue $11,250.00 45 -5010.88 -4785.88 -4560.88 -4335.88
Fixed Costs $9,554.10 50 -4410.88 -4160.88 -3910.88 -3660.88
Variable Costs $856.78 55 -3810.88 -3535.88 -3260.88 -2985.88
Net Income $839.12 60 -3210.88 -2910.88 -2610.88 -2310.88
65 -2610.88 -2285.88 -1960.88 -1635.88

Client Demand
70 -2010.88 -1660.88 -1310.88 -960.88
75 -1410.88 -1035.88 -660.88 -285.88
80 -810.88 -410.88 -10.88 389.12
85 -210.88 214.12 639.12 1064.12
90 389.12 839.12 1289.12 1739.12
95 989.12 1464.12 1939.12 2414.12
100 1589.12 2089.12 2589.12 3089.12
105 2189.12 2714.12 3239.12 3764.12
Data Table
n Prices
140 145 150
-4110.88 -3885.88 -3660.88
-3410.88 -3160.88 -2910.88
-2710.88 -2435.88 -2160.88
-2010.88 -1710.88 -1410.88
-1310.88 -985.88 -660.88
-610.88 -260.88 89.12
89.12 464.12 839.12
789.12 1189.12 1589.12
1489.12 1914.12 2339.12
2189.12 2639.12 3089.12
2889.12 3364.12 3839.12
3589.12 4089.12 4589.12
4289.12 4814.12 5339.12
Green Paradise Golf Course and Shop
Forecast of Product Sales

Extended
Inventory Items Qty. Price Price Goal
Stock Golf Balls 781.25 $32.00 $25,000 $25,000
Golf Shorts 250 $50.00 $12,500 $12,500
Large Golf Umbrella 100 $42.50 $4,250 $4,250
High Performance Golf Polo 274.6323529 $68.00 $18,675 $18,675
Scenario Summary
Most Likely Best-case Worst-case
Changing Cells:
Retail Sales $50,000.00 $100,000.00 $20,000.00
Lessons and Fees $200,000.00 $325,000.00 $75,000.00
Result Cells:
Net Income $235,954.00 $403,454.00 $85,454.00
Notes: Current Values column represents values of changing cells at
time Scenario Summary Report was created. Changing cells for each
scenario are highlighted in gray.
$D$4:$D$5,$C$15 by (All)

Row Labels Net Income


Best-case 403454
Most Likely 178454
Worst-case 86954
Green Paradise Golf Course and Shop
Profit Scenarios
Revenue
Retail Sales $25,000.00
Golf Lessons and Fees $162,500.00
Gross Revenue $187,500.00
Expenses
Fixed Costs
Manager Salaries $4,669.00
Utilities $427.00
Equipment Depreciation $1,122.00
Insurance $328.00
Total Fixed Costs $6,546.00
Variable Costs
Employee Commissions 10% $2,500.00
Total Expenses $9,046.00
Net Income $178,454.00
Microsoft Excel 16.0 Answer Report
Worksheet: [CB2022w04Demo.xlsx]GolfLessons
Report Created: 2017-02-08 1:29:12 PM
Result: Solver has converged to the current solution. All Constraints are satisfied.
Solver Engine
Engine: GRG Nonlinear
Solution Time: 0.047 Seconds.
Iterations: 3 Subproblems: 0
Solver Options
Max Time Unlimited, Iterations Unlimited, Precision 0.000001
Convergence 0.0001, Population Size 100, Random Seed 0, Derivatives Central, Multistart
Max Subproblems Unlimited, Max Integer Sols Unlimited, Integer Tolerance 1%, Assume NonNegative

Objective Cell (Max)


Cell Name Original Value Final Value
$D$20 Net Income -$1,707.50 $8,032.90

Variable Cells
Cell Name Original Value Final Value Integer
$D$4 Total Clients 1 14 Integer
$D$5 Instructors on Duty 1 4 Integer

Constraints
Cell Name Cell Value Formula Status Slack
$D$4 Total Clients 14 $D$4<=14 Binding 0
$D$4 Total Clients 14 $D$4>=7 Not Binding 7
$D$5 Instructors on Duty 4 $D$5<=4 Binding 0
$D$4:$D$5=Integer
Green Paradise Golf Course and Shop
Solver for Golf Lessons
Input Variables
Total Clients 14
Instructors on Duty 4
Revenue
Lesson Fee $185.00
Gross Revenue $10,360.00
Expenses
Fixed Costs
Utilities $427.00
Equipment Depreciation $1,122.00
Insurance $328.00
Total Fixed Costs $1,877.00
Variable Costs
Instructor Commission 3% $310.80
Supplies per Client $9.95 $139.30
Total Variable Costs $450.10
Total Expenses $2,327.10
Net Income $8,032.90

Saved Solver Models


$8,032.90
2
1
1
1
1
32767
0