MGM272

Business Applications of Technology

Assignment / Project   Number  08

Graphing: Line Graphs and Formulas 

This project is about using MS-Excel to make graphs, and in particular about making line graphs and about graphing formulas.  In this project, you will use MS-Excel to create a line graph depicting formulas used in "breakeven analysis".  

Breakeven analysis is a simple type of financial analysis which you will see in many of your business courses.  It is used to find out how many products must be produced to avoid having a negative profit.  Breakeven analysis takes in account the revenue received for each item, the cost of producing each item, and the cost of doing business for that item irrespective of the production costs.  Those three are typically called respectively: price, variable cost, and fixed cost.  A formula for calculating the net profit can be represented by:

     Profit  =  Total Revenue  -  Total Cost                 or 

     Profit  =  [price * quantity]  -  [variable cost * quantity  +  fixed cost]

For this project, you will create a graph which will display the total revenue and the total cost for various production levels of a product whose price, variable cost, and fixed cost you will be given.  You will use "drawing objects" to illustrate the point on your graph at which the profit is exactly equal to zero. Click here for an example of a line graph of revenue, cost and breakeven.  In order  to get date for your own graph and project assignment, you can click here and then save the data to your own spreadsheet file.

In class we will talk about how to create line graphs and how to set up a spreadsheet to allow graphing formulas.  We will also talk about "drawing objects" which can be used to help illustrate parts of a spreadsheet page.

You will need to turn in the following to the instructor on the date this assignment is due (check the class schedule):
  1) PRINTOUT #1:  A printed copy of your spreadsheet, showing
      (A) the data: revenue, cost, and profit for various production levels (you pick the appropriate levels),
      (B) a single graph showing lines for the total revenue and total cost for various production levels, and
      (C) an arrow pointing to the breakeven point on the graph and a textbox which labels it.
  2) PRINTOUT #2:  A printed copy of your spreadsheet, showing showing the formulas on your sheet.
  3) DISK FILE:  A copy of the disk file on which you have saved your spreadsheet. 
       The name of the file on the disk should be "breakeven.xls"
       The label on the disk should have YOUR NAME, and the words:
       ASSIGNMENT #08 -- LINE GRAPH
  4) OTHER:  The above items are all that is required for this assignment.

You might want to check the instructor's remarks on how this project was graded the last time it was assigned by clicking here.