...sale price is $25 per unit, taxes are 35% and the appropriate discount rate is 12%?
breakeven point will decrease
breakeven point (units) = fixed costs/contribution contribution = selling price - variable costs per unit
Formula for Breakeven point: Breakeven point = Fixed Cost / Contribution margin ratio Contribution margin ratio = Sales / contribution margin Contribution margin = sales - variable cost
Units-of-production
yes..depreciation cost is the variable cost..
depreciation is classed as a fixed cost when using only the straight line method. reducing balancing method is classed as a variable cost.
Depreciation is a fixed cost because variable cost is that cost which change with the change in the production units but it doesn't put any effect on depreciation as depreciation of the equipment will remain same no matter you produce maximum number of units or produce no unit in fiscal year.
Fixed cost / (selling price - Variable cost per unit) --> Fixed cost ----------------------------------------------- (Selling Price - Variable Cost Per Unit)
According to my text book, depreciation is a Fixed cost
A Vanguard variable annuity does seem be a good investment in the current market. As with any investment, there are no guarantees of profitable returns.
Breakeven point = Fixed cost/Contribution margin Contribution margin = sales price - variable cost contribution margin = 20 - 7 = 13 Breakeven point = 173000/13 = 13307.7 units
It is used in the same way that it was in the past! It is relevant for compound growth (for example, interest on investment or simple population growth) or compound decrease (depreciation or radioactive decay). There are also very many other situations where the change in a variable is directly proportional to the value of the variable.