Johnson Lumber Financial Data ANNUAL REVENUE PRIOR TO THE FIRE įREVENUE EXPENSES $ es $ NET INCOME (EBIT) $ GROSS MARGIN

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Johnson Lumber Financial Data Annual Revenue Prior To The Fire Irevenue Expenses Es Net Income Ebit Gross Margin 1 (45.71 KiB) Viewed 27 times

Calculate economic profit or loss for rebuilding incomparison to the alternative of rebuilding while continuing withoffsite production
You must use marginal analysis to calculate the economicprofits
Johnson Lumber Financial Data ANNUAL REVENUE PRIOR TO THE FIRE įREVENUE EXPENSES $ es $ NET INCOME (EBIT) $ GROSS MARGIN % INET MARGIN% BENEFITS es 2 CONTINUE PRODUCTION OFF SITE 15,175,460 INSURANCE COVERS REBUILDING: 12,916,815 INSURANCE COVERAGE FOR EQUIPMENT 2,258,645 i 30%! 14.9%! ALTERNATIVES 1 STOP ALL PRODUCTION AND BUILD BACK THE MILL USING INSURANCE PAYOUT. TIME TO BUILD: 1 YEAR CUSTOMER RETENTION AFTER REBUILD: 55% FINANCIAL CONSEQUENCES ARISING FROM THE FIRE AT THE MILL SALES Less: Cost of sales @70% (Material and wages) GROSS MARGIN @30% Lease of space Lease of machinary Insurance property Insurance equipment damage Transportation No chip revenue Other Customer related expenes TOTAL OPERATING COSTS $30 per sq ft for 10000 sq ft per month $10,000 per month $10,000 per month $5,000 per month $12,000 per month $5000 per month NET INCOME (EBIT) Customer Retention after rebuilding $ $ $ $ $ $ $ $ $ es $ $ $ is 7,739,485 5,417,639 2,321,845 3,600,000 120,000 120,000 60,000 144,000 60,000 4,104,000 (1,782,155) 80% $ $ 5,000,000 3,000,000