Marginal Analysis Decision Simulator

Make optimal decisions in various business scenarios.

Decide Whether to Accept a Special Order

Data Input

Special Order Price (per unit)

Special Order Quantity

Variable Manufacturing Cost (per unit)

No Excess Capacity (Incurs Opportunity Cost)

Contribution Margin Lost (Total)

Analysis Result

Incremental Profit / Loss

$50,000

Accept the special order.

Make vs. Buy Decision

Data Input

Required Quantity

Outside Purchase Price (per unit)

Variable Cost to Make (per unit)

Avoidable Fixed Cost (Total)

Analysis Result

Total Cost to Make

$80,000

Total Cost to Buy

$100,000

Cost Difference from Decision

$20,000

It is better to make in-house.

Sell or Process Further Decision

Data Input

Sales Value at Split-off

Sales Value after Further Processing

Separable Cost for Further Processing

*Joint Costs are irrelevant and not included in this analysis.

Analysis Result

Incremental Profit / Loss from Further Processing

$250

It is better to process further.

Keep or Drop a Segment Decision

Data Input

Contribution Margin of the Segment

Avoidable Fixed Costs of the Segment

*Unavoidable fixed costs are irrelevant as they will be incurred regardless of the decision.

Analysis Result

Net Income Impact if Dropped

$1,000

It is better to drop the segment.