"risk management" question: Aaron is aware of the importance of identifying risks. Q.1.5.1 Explain the difference between micro risks and macro risk identification. Q.1.5.2 Provide him with a practical, comprehensive example of how he could use his financial statements to identify a macro risk. Case study: Aaron is a young entrepreneur. He saw a business opportunity in making and delivering homecooked meals. His business is called Made For You. Initially, his target market was only students. However, his business grew quickly, and he secured a contract to provide daily meals for several retirement villages. Initially, he ran his business from his kitchen, but now he is leasing a property in the industrial area. The property consists of an industrial kitchen, a large storage room and a small office. He also owns a delivery vehicle. Aaron is in charge of all the administration and has employed four cooks and one driver. Aaron was so focused on operations that he did not focus on risk management. He has now realised the importance of risk management, and he has come to you with some questions.
Breakeven Analysis
Break Even Analysis is a term used in business, cost accounting and economics. It refers to a point where the total cost incurred becomes equal to the total revenue earned. Break Even Analysis determines the number of units to be sold to earn the revenue required to cover the total costs. Total cost is a sum total of fixed and variable costs.
Process analysis
The term process analysis can be defined as breakdown of production process into different phases that converts inputs into output. A series of routine activities are incorporated using organizational resources with a view to achieve operational excellence.
"risk management" question:
Aaron is aware of the importance of identifying risks.
Q.1.5.1 Explain the difference between micro risks and macro risk identification.
Q.1.5.2 Provide him with a practical, comprehensive example of how he could use his financial statements to identify a macro risk.
Case study:
Aaron is a young entrepreneur. He saw a business opportunity in making and delivering homecooked meals. His business is called Made For You. Initially, his target market was only students. However, his business grew quickly, and he secured a contract to provide daily meals for several retirement villages. Initially, he ran his business from his kitchen, but now he is leasing a property in the industrial area. The property consists of an industrial
kitchen, a large storage room and a small office. He also owns a delivery vehicle. Aaron is in charge
of all the administration and has employed four cooks and one driver. Aaron was so focused on operations that he did not focus on risk management. He has now realised the importance of risk management, and he has come to you with some questions.
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