Break-even analysis Flashcards
1
Q
How do you calculate the break even point in units
A
Fixed costs ÷ contribution per unit
2
Q
How do you calculate break even in £s
A
Break even units x selling price
3
Q
How do you calculate margin of safety as a percentage
A
(Current output - break even output) ÷ current output x 100
4
Q
How do you calculate margin of safety
A
Maximum output - break even output
5
Q
How do you calculate the output required to give the target profit
A
(Fixed costs + target profit) ÷ contribution per unit
6
Q
How do you calculate profit volume ratio/ contribution sales ratio
A
Contribution ÷ selling price
7
Q
How do you calculate contribution
A
Selling price per unit - variable costs per unit
