formula sheet - Break-even? Definitions Total Profit =...

Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
1 Break-even? Definitions Total Profit = Total Revenue - Total Cost Break even just means that profit (or profit change)=0 0=Total Profit=Unit Volume*(Unit Price – Unit Variable Cost) – Total Fixed Cost 1 Unit Volume*(Unit Price – Unit Variable Cost) = Total Fixed Cost Unit Volume*Unit Contribution= Total Fixed Cost Now, solve for any variable you want Total break even volume solve for Unit Volume Break even price solve for Unit price Break even Unit Contribution solve for Unit Contribution Break Even Total Fixed Cost Total Break-Even Unit Volume (TBEV) = Unit Contribution Incremental Expenditure Incremental Break Even Unit Volume (IBEV)= Total Fixed Cost + Depreciation Total Break-Even Unit Volume (TBEV) - Accounting= Unit Contribution For fixed cost increase: 2 Old Unit Volume * Unit Contribution Loss Incremental Break Even Unit Volume (IBEV) = New Unit Contribution Incremental Break Even Unit Volume (IBEV) = Unit Contribution
Background image of page 1
This is the end of the preview. Sign up to access the rest of the document.

This document was uploaded on 02/27/2012.

Ask a homework question - tutors are online