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Balance Sheet

Balance Sheet 2020 (All numbers in millions)
	2020	2019
Assets
Current Assets
Cash and cash equivalents	3.64	3.11
Marketable securities	0	0
Accounts Receivable	6.83	7.59
Inventory	10.12	12.60
Total Current Assets	20.59	23.30
Non-current Assets
Property and equipment	10.92	8.44
Accumulated depreciation	(8.60)	(7.18)
Intangible assets	9.18	10.55
Total Non-Current Assets	11.50	11.81
Total Assets	32.09	35.11
Liabilities
Current liabilities
Short-term debt	7.80	1.21
Accounts Payable	6.51	5.35
Total Current Liabilities	14.31	6.56
Non-current liabilities
Long-term debt	12.93	13.01
Total Non-Current Liabilities	12.93	13.01
Total Liabilities	27.24	19.57
Shareholders' Equity
Common stock	9.35	7.04
Retained earnings	(4.50)	8.50
Total equity	4.85	15.54
Total liabilities and equity	32.09	35.11

Profit and Loss Statement

2020 Income Statement (All numbers) in millions
	2020
Total Revenue	44.52
Cost of Goods Sold	(25.61)
Gross Profit	18.91
Expenses
Wages	10.40
Rent	1.20
Utilities	0.80
Administrative expenses	0.48
Marketing and sales expenses	5.57
Depreciation expense	1.42
Total Operating Expenses	19.87
Earnings Before Interest and Tax	(0.96)
Interest Expense	2.38
Other losses	10.48
Earnings Before Tax	(13.82)
Income Tax (30%)	0.0
Net Profit	(13.82)

Financial information for break-even analysis (in USD)

On average, the business sells bundles of driver fatigue systems along with the software systems to run them. On average, the revenue from a single sale is worth USD100,000 to Traffic Solutions.

Average revenue per sale	100,000
Variable costs per unit sold
Raw materials	50,000
Direct labour	7,000
Fixed costs
Wages	10,400,000
Rent	1,200,000
Utilities	800,000
Admin expenses	480,000
Marketing and Sales expenses	6,510,000
Interest expense	2,380,000

The following table provides the unit sales for 2019 and 2018. Based on the total revenue for 2020 and the unit price per sale you should be able to determine the total number of unit sales in 2020.

Year	2020	2019	2018
Unit sales	?	592	587

Answer & Explanation Solved by verified expert

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