Fixed Costs Flashcards
1
Q
What is a fixed cost
A
Cost that do not change in line with output/ sales
2
Q
What is a variable cost
A
Cost that do change in line with output/sales
3
Q
Breakeven formula
A
Fixed cost divided selling price minus vcpu
4
Q
Revenue formula
A
Price x quantity
5
Q
What is breakeven
A
Breakeven is the point where cost and income are equal, neither profit or loss
6
Q
Profit formula
A
Revenue - cost
7
Q
Margin of safety
A
Actual level of sales - breakeven point
