6 (A) COURSE OVERHEADS Type of unit No of units Rate per unit Costs ($$)

7 Management (ongoing) per annum salary 0.30 60000 18000

8 Secretarial support (ongoing) per annum salary 1.00 40000 40000
9 Recurrent costs 58000
10 (B) ONE-OFF DEVELOPMENT AND PRODUCTION COSTS
11 Development Print Type of unit No of units Rate per unit Costs ($$)
12 Management (development) per annum salary 0.50 60000 30000
13 Secretarial support (development) per annum salary 1.00 40000 40000
14 Authoring of study guide Study guide (48pp) 10 1728 17280
15 Preparation of a Reader Reader 144 1 1148 1148
16 Editing and design Per 48 pp 13 720 9360
17 Copyright Per 48 pp 13 1728 22464
18 Development Cassettes Type of unit No of units Rate per unit Costs ($$)
19 Development of content Per hour 100 40 4000
20 Instructional design Per hour 60 25 1500
21 Production Per hour 50 20 1000
26 Copyright Per DVD 1 1500 1500
27 Development Assignment Type of unit No of units Rate per unit Costs ($$)
28 Assignment Per assignment 5 1104 5520
29 Total fixed costs of development 133772
30 (C) MAINTENANCE COSTS (PART OF PRINTED MATERIAL ONLY)
31 Author Per study guide 3 1728 5184
32 Editing and design Per study guide 3 1148 3444
33 Copyright Per study guide (updating 3 720 2160
34 Total fixed costs of maintenance 10788
35 Total fixed costs 144560
36 (D) ANNUAL PRESENTATION COSTS (all per student)
37 Student Support Type of unit No of units Rate per unit Cost/student ($$)
38 Marking of assignment Per assignment 5 40 200.00
39 Tutor (per group of 24) Per Hour and group of 24 30 19 23.75
40 Tuition expenses Per group of 24
41 Replication and Distribution Type of unit No of units Rate per unit Cost/student ($$)
42 Production study guides Per study guide 10 8 80.00
43 Production assignments Per assignment 3 16.3333333 49.00
44 Production of Reader Per reader 1 12 12.00
45 Packaging and postage Per mailing 2 15.2 30.40
46 Total variable cost per student 395.15
47 (E) INCOME (per student per credit) Income per student
48 Fee Per credit point 3 380 1140
 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7
No of students 120 120 120 120 120 120 120
Accumulated 120 240 360 480 600 720 840
Recurring Cost 58000 58000 58000 58000 58000 58000 58000
FD depreciated (8 years) 16722 16722 16722 16722 16722 16722 16722
FM depreciated (3 years) 3596 3596
F depreciated 74722 74722 74722 74722 74722 78318 78318
FD annualized (8 years at 6.5%) 21970 21970 21970 21970 21970 21970 21970
FM annualized (4 years at 6.5%) 3149 3149 3149
F annualized/per year 79970 79970 79970 79970 83119 83119 83119
F annualized (total) 652356 652356 652356 652356 652356 652356 652356
Aggregate unit costs 395.15 395.15 395.15 395.15 395.15 395.15 395.15
TC=F+VxN 699774 747192 794610 842028 889446 936864 984282
AC=F/N+V 5831 3113 2207 1754 1482 1301 1172
Income per student 1140 1140 1140 1140 1140 1140 1140
Income 136800 273600 410400 547200 684000 820800 957600
Profit -562974 -473592 -384210 -294828 -205446 -116064 -26682
 Costs and income 936864
889446
Total costs 842028
820800
794610
747192
699774 Fixed costs
684000
652356 652356 652356 652356 652356 652356

547200

Break
even
410400 point
$$

273600

c ome
In
136800

120 240 360 480 600 720

No students
F annual ized (total ) Linea r (F annual ized (tota l)) TC=F+VxN Income
Average costs per student

5831

Variable
cost per
student

3113

2207

1754
1482
1301

395 395 395 395 395 395

Average
120 costs 240 360 480 600 720
per
student
No students
Aggregate uni t costs AC=F/N+V Li near (AC=F/N+V)
 Year 1 Year 2 Year 3 Year 4
No of students 120 120 120 120
Accumulated 120 240 360 480
F annualized (total) 652356 652356 652356 652356
Aggregate unit costs 395 395 395 395
TC=F+VxN 699774 747192 794610 842028
AC=F/N+V 5831 3113 2207 1754
Income per student 1140 1140 1140 1140
Income 136800 273600 410400 547200
Profit -562974 -473592 -384210 -294828
Year 5 Year 6 Year 7 Year 8
120 120 120 120
600 720 840 960
652356 652356 652356 652356
395 395 395 395
889446 936864 984282 1031700
1482 1301 1172 1075
1140 1140 1140 1140
684000 820800 957600 1094400
-205446 -116064 -26682 62700