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Unformatted text preview: 1. Decision Point – where INCREMENTAL (additional) fixed costs are covered by INCREMENTAL contribution 2. “What is left over after covering variable costs that contributes toward covering fixed costs?” 3. Use ratio – can’t do it on a per unit basis o What % of every sales dollar is left over after covering variable costs that contributes toward covering fixed costs? 4. Analysis o Qualitative o Quantitative (Contribution) Contribution rate 5. When there are only total value given 6. Contribution rate = 1-VC/Sales 7. What do our total $ Sales have to be at contribution rate of 1- (VC/Sales) to cover fixed costs? 8. Margin = FC/(Contribution Rate) = FC/(1- VC/Sales)...
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This note was uploaded on 01/11/2012 for the course BIOL 2021 BIOL 2021 taught by Professor Pat during the Fall '10 term at York University.
- Fall '10