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If a firm has a price of 4.00 variable cost per unit of 2.50 and a breakeven point of 20000 units fixed costs are equal to?
Wiki User
∙ 14y ago
Breakeven is when Sales minus Variable Cost minus Fixed Cost = 0
Here we have:
(20,000 x 4.00) - (20,000 x 2.50) - FC = 0
80,000 - 50,000 - FC = 0
30,000 - FC = 0
So Fixed Cost = 30,000
Wiki User
∙ 14y ago
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What is happening to average variable costs when they equal marginal costs?
When average variable costs equal to the average marginal cost, the average variable cost will be at the minimum point. i.e. lowest cost
What is the breakeven of a fixed cost equal 300000 the price per unit equals 10 and the variable cost per unit equals 7?
Fixed cost = 300000 Contribution margin ratio = (sales - variable cost) / sales Contribution margin ratio = (10 - 7 ) / 10 Contribution margin ratio = .3 breakeven point = 300000 / .3 = 1000000
Contribution margin is equal to fixed costs minus variable costs?
No... The contribution margin is the dollar amount of each unit of output that is available first to cover fixed costs and then to contribute to profit.
What are total cost of production examples?
In a perfectly competitive market, all n firms are equal. Thus, the market total cost is the total cost (TC) of one firm multiplied by the amount of n firms in the market Total Market Cost =Variable Costs and fixed costs ...Fixed costs plus variable costs.
Explain Total cost marginal cost and average cost curves?
The increase or decrease in the total cost of a production run for making one additional unit of an item. It is computed in situations where the breakeven point has been reached: the fixed costs have already been absorbed by the already produced items and only the direct (variable) costs have to be accounted for.Marginal costs are variable costs consisting of labor and material costs, plus an estimated portion of fixed costs (such as administration overheads and selling expenses). In companies where average costs are fairly constant, marginal cost is usually equal to average cost. However, in industries that require heavy capital investment (automobile plants, airlines, mines) and have high average costs, it is comparatively very low. The concept of marginal cost is critically important in resource allocation because, for optimum results, management must concentrate its resources where the excess of marginal revenue over the marginal cost is maximum. Also called choice cost, differential cost, or incremental cost.Average CostIn economics, average cost or unit cost is equal to total cost divided by the number of goods produced (the output quantity, Q). It is also equal to the sum of average variable costs (total variable costs divided by Q) plus average fixed costs (total fixed costs divided by Q). Average costs may be dependent on the time period considered (increasing production may be expensive or impossible in the short term, for example). Average costs affect the supply curve and are a fundamental component of supply and demand.Total CostIn economics, and cost accounting, total cost (TC) describes the total economic cost of production and is made up of variable costs, which vary according to the quantity of a good produced and include inputs such as labor and raw materials, plus fixed costs, which are independent of the quantity of a good produced and include inputs (capital) that cannot be varied in the short term, such as buildings and machinery. Total cost in economics includes the total opportunity cost of each factor of production as part of its fixed or variable costs.The rate at which total cost changes as the amount produced changes is called marginal cost. This is also known as the marginal unit variable cost.
What is the break even in units if a firm sells 20000 units at 40 each variable costs per unit are 10 and total fixed costs equal 120000?
1. Breakeven point = fixed cost/ contribution margin ratio contribution margin ratio: (sales - variable cost)/sales Sales = 20000 * 40 = 800000 Less: Variable cost = 20000 * 10 = 200000 Contribution margin = 600000 Contribution margin ratio = 600000/800000 = .75 Breakeven point in dollars = 120000/.75 = $160000 breakeven point in units = 160000 / 40 = 4000
What do you call when total revenues equal total costs?
Breakeven.
What does breakeven point mean?
Breakeven Analysis is the process of categorizing costs of production between variable and fixed components and deriving the level of output at which the sum of these costs, referred to as total costs per unit become equal to sales revenue. The analysis helps to determine the 'Breakenev Point' from this point of equality of sales revenue with total costs. At the breakeven point, the production activity neither generates a profit nor a loss. Breakeven analysis is used in production management and Management Accounting.
Produce 60000 variable costs equal 50 percent fixed costs total 120000 what price stero sold to achieve EBIT of 95000?
Breakeven point = Fixed cost + EBIT / contribution margin ratio Contribution margin ratio = sales price - variable cost Contribution margin ratio = 1 - 0.5 = 0.5 or 50% Breakeven point = 215000 / .5 = 430000
What is happening to average variable costs when they equal marginal costs?
When average variable costs equal to the average marginal cost, the average variable cost will be at the minimum point. i.e. lowest cost
How do you calculate transfer pricing?
The transfer price should be equal to the variable costs of the goods or services, plus the contribution margin per unit that is lost. =variable costs+(selling price-variable costs)
Can total revenues and total variable costs be exactly equal?
Yes. Actually this means the company has zero gross profit. If on top of variable costs, there are fixed costs, the company will turn a loss.
What is the breakeven of a fixed cost equal 300000 the price per unit equals 10 and the variable cost per unit equals 7?
Fixed cost = 300000 Contribution margin ratio = (sales - variable cost) / sales Contribution margin ratio = (10 - 7 ) / 10 Contribution margin ratio = .3 breakeven point = 300000 / .3 = 1000000
Cost of goods sold is equal to?
breakeven point
Does contribution margin equal Sales-variable costs?
Contribution margin is computed as sales revenue minus variable expenses
What are examples of total costs?
In a perfectly competitive market, all n firms are equal. Thus, the market total cost is the total cost (TC) of one firm multiplied by the amount of n firms in the market Total Market Cost =Variable Costs and fixed costs ...Fixed costs plus variable costs.
Contribution margin is equal to fixed costs minus variable costs?
No... The contribution margin is the dollar amount of each unit of output that is available first to cover fixed costs and then to contribute to profit.
