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# Sometimes the terms margin and markup are used

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Unformatted text preview: cost. Procedure Keystrokes Select Profit Margin worksheet. Display CST (old contents) Clear worksheet. CST = 0.00 Enter selling price. 125 SEL = 125.00 Enter profit margin. 20 MAR = 20.00 Compute cost. CST = 100.00 The original cost is \$100. The Breakeven Worksheet Press to access the Breakeven worksheet. This worksheet allows you to determine the breakeven point and sales level necessary to earn a given level of profit. Breakeven Worksheet Labels Label Meaning Type of Variable FC Fixed cost Enter/compute VC Variable cost per unit Enter/compute P Unit price Enter/compute PFT Profit Enter/compute Q Quantity Enter/compute Chapter 7: Using Other Worksheets 65 Notes on the Breakeven Worksheet sets FC, VC, P, PFT, and Q to zero. sets FC, VC, P, PFT, and Q to zero. Enter values for any four of the five variables. Then compute a value for the fifth variable. To solve for Q (the breakeven quantity), enter a value of zero for PFT (profit). Background Information The Breakeven worksheet is a tool for analyzing the relationships between fixed costs, variable costs per unit, quantity, price, and profit. Until the breakeven quantity is reached (total costs = total revenues), you operate at a loss. Procedure: Using the Breakeven Worksheet 1. Press to select the worksheet. FC is displayed, along with the previous value. 2. If necessary, press to clear the worksheet. 3. Enter values for four of the five variables; for example, enter values for FC, VC, P, and PFT. Press or until the variable label you want is displayed. Then key in a value and press . 4. Compute a value for the unknown variable; for example, compute a value for Q. Press . or until the variable label you want is displayed. Then press The calculator computes and displays the value. 66 Chapter 7: Using Other Worksheets Example: Computing Breakeven Quantity A canoe company sells paddles for \$20 each. The unit variable cost is \$15, and the fixed costs are \$3,000. How many paddles must be sold to break even? Procedure Keystrokes Display Select Breakev...
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## This homework help was uploaded on 04/03/2014 for the course ECON 203 taught by Professor Petry during the Summer '09 term at University of Illinois, Urbana Champaign.

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