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Unformatted text preview: (Total Fixed Costs + $0) / Unit Contribution = Quantity Breakeven and Profit Goal Analysis (Total Fixed Costs + $0) / Unit Contribution = Quantity Remember, Total Profit = $0 at Breakeven (this is like having a profit goal of $0), so we can rewrite the above: Total Fixed Costs / Unit Contribution = Breakeven Quantity If we have a profit goal of $198,700: (Total Fixed Costs + $198,700) / Unit Contribution = Quantity Keep in mind that unit contribution contributes to two things: Fixed Costs and Profits, you have to cover the Fixed Costs before you can make a profit....
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This note was uploaded on 03/17/2009 for the course BCOR 2400 taught by Professor Rexmoody during the Spring '08 term at Colorado.
- Spring '08