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How do you use the contribution margin to determine a company's break-even point?
Wiki User
∙ 13y ago
Therefore, it is logical to divide fixed costs by the contribution margin to determine how many units must be produced to reach the break-even point
Wiki User
∙ 13y ago
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Calculation of break-even point?
Breakeven point = Fixed Cost / Contribution margin ratio Contribution margin ratio = (Sales - Variable Cost) / Sales
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
How an increase in unit selling prices might affect contribution margin?
Increase in unit selling price while other costs remains same will increase the contribution margin and reduce the breakeven point.
What happens to the breakeven point when you increase the selling price?
Increase in selling price reduces the breakeven point because due to increase in price contribution margin ratio also increases.
How do you determine break even point when the unit price isn't given?
if sales revenue is provided instead of unit price then breakeven point can be determine by deducting variable costs from sales revenue and so on dividing fixed cost with contribution margin.
How do you calculate the breakeven point?
Formula for Breakeven point: Breakeven point = Fixed Cost / Contribution margin ratio Contribution margin ratio = Sales / contribution margin Contribution margin = sales - variable cost
Break even point on sales of 20 per unit variable 7 and fixed annually 173000?
Breakeven point = Fixed cost/Contribution margin Contribution margin = sales price - variable cost contribution margin = 20 - 7 = 13 Breakeven point = 173000/13 = 13307.7 units
What percentage of the contribution margin is profit on units sold in excess of the breakeven point?
50%
Break Even Sales - Formula in Cost Accounting?
Breakeven point = Fixed Cost / Contribution margin Contribution margin = (Sales - Variable cost) / Sales
How do you do the calculation for the break even point?
Breakeven point = Fixed cost / contribution margin ratio contribution margin ratio = sales - variable cost / sales.
Calculation of break-even point?
Breakeven point = Fixed Cost / Contribution margin ratio Contribution margin ratio = (Sales - Variable Cost) / Sales
How do you calculate the break even point for EBIT?
Breakeven point = Fixed cost / contribution margin ratio contribution margin ratio = sales - variable cost / sales.
How do you calculate break-even?
Formula to calculate breakeven point is as follows: Break even point = Fixed cost / contribution margin Contribution margin = Sales - Variable cost
How do you compute break even analysis?
breakeven = fixed cost / contribution margin ratiocontribution margin ratio = sales - variable cost / sales
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
What would the sales be if the company desires a profit of 104300 in sales and the break even point in dollar sale for Rice Company is 352000 and the company contribution margin ratio is 35 percent?
Break even sales = fixed cost + desired profit / contribution margin ratio Fixed cost = breakeven point sales * contribution margin Fixed cost = 352000 * 0.35 = 123200 Breakeven point = (123200 + 104300 ) / 0.35 Breakeven point = 332857
What would be the contribution margin ratio if a company had a break even point of 350000 and a selling price of 7 per unit and fixed cost of 105000?
Breakeven point = fixed cost/contribution margin ratio350000 = 105000/ contribution margin ratioContribution margin ratio = 105000/350000Contribution margin ratio = 0.3 or 30 %
