Break even analysis formula Flashcards
Contribution.
Selling price per unit- variable cost per unit = £….
Break even point in units.
fixed costs divided by selling price per unit - variable cost per unit
Fixed costs divided by contribution
Break even point in sales value.
Break even point in units x selling price = £….
Profit achieved at a certain unit level.
units x contribution - fixed costs = £….
The margin of safety in units.
Current production or sales units - break even units = ……units
The margin of safety in sales value.
Margin of safety in units x selling price = £….
What happens to the break-even point if costs go up?
If costs go up break even point will rise.
what happens to the break even point if costs go down?
If costs go down the break even point will fall.
What happens to the break even point if the selling price goes up?
If the selling price goes up then the break even point will fall
What happens to the break even point if the selling price goes down?
If the selling price goes down them the break even point will rise.
The margin of safety in sales value.
Margin of safety in units x selling price = £…
How many units to sell to make a certain profit level?
Fixed costs + Profit required divided by contribution =number of units required to make stated profit.
