Molto Delizioso: Pricing and Profit Following Brexit Devaluation
Autor: vmarfo • October 23, 2018 • Case Study • 3,005 Words (13 Pages) • 1,157 Views
Income Statement
revenue:
sales 200*40000 £8,000,000
less expenses:
contract labor 5*40000 £200,000
import of coffee machine (€90*40000)/1.16 £3,103,448
marketing and distribution £400,000
other fixed cost £500,000
total Expenses £4,203,448
profit in Pounds £3,796,552
profit in Euros (£3,796,552*1.16) € 4,404,000
The price elasticity of 1.1 will result in a change of demand by 19.25%. Therefore the demand for the coffee machines will fall by 7,700 units. The total units sold will be 32,300 units.
Income Statement
revenue:
sales 235*32300 £7,590,500
less expenses:
contract labor 5*32300 £161,500
import of coffee machines (€90*32300)/1.16 £2,506,034
marketing and distribution £400,000
other fixed cost £500,000
total expenses £3,567,534
profit in pounds £4,022,966
profit in euros (£4,022,966*1.16) € 4,666,640
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