A souvenir shop makes the following forecast for one year’s sales and costs.
|
Forecast |
£ |
|
sales |
80,000 |
|
variable costs of souvenirs purchased |
(26,000) |
|
fixed labour costs |
(30,000) |
|
other fixed costs |
(5,000) |
|
Profit |
19,000 |
Required
Prepare tables showing the sensitivity of the profit forecast to each of the following:
(a) a 1 per cent change in sales and variable costs,
(b) a 1 per cent change only in the materials cost of souvenirs purchased,
(c) a 1 per cent change only the labour costs, and
(d) a 1 per cent change only in the other fixed costs.