unit = $1000 (upto 102,000 units) Variable cost per unit = $400 Annual Fixed Operating Cost = $1,620,000 (includes opportunity cost of rent) Depreciation = 2,000,000 (assuming straight line depreciation over 10 years) Accounting Break-Even = (Fixed Cost +
Words: 1041 - Pages: 5
respect of both factories : Selling price per unit Variable cost per unit Fixed cost Depreciation included in above Sales (Units) Capacity (Units) You are required to determine : * Output Break-even-points for each factory. * Capacity Break-even-point for each factory. * Cash Break-even-point for each factory, * Which factory is more profitable ? * B.E.P. for company as whole assuming the present product-mix. * B .E.P. for company assuming that product-mix can be changed
Words: 1404 - Pages: 6
Introduction The break-even analysis is the study of revenues and costs of a firm in relation to its volume of sales and specially the determination of that volume at which its costs and revenues are equal to each other. The break-even point (BEP) may be defined as that level of sales of a firm at which its total revenues are equal to its total costs and hence its net income is zero. Break-even analysis discusses about the behavior of total cost and total revenue on the increasing output. Every
Words: 450 - Pages: 2
courses taken in their Master Degree program, and how CVP analysis can be an extremely useful tool for determining the potential success of a business they might consider opening one day. Particular attention is given to important concepts such as break-even analysis and the effect of changing working assumptions on final results.
Words: 2825 - Pages: 12
Tulsa Memorial Hospital Break-Even analysis Introduction: Tulsa Memorial Hospital (TMH), an acute care hospital with 300 beds and 160 staff physicians, is one of 75 hospitals owned and operated by Health Services of America, a for-profit, publicly owned company. Although there are nine other acute care hospitals serving the same general population, TMH historically has been highly profitable because of its well-appointed facilities, fine medical staff, and reputation for quality care. In
Words: 500 - Pages: 2
marketplace and the second was to analyze the Guillermo Furniture Company. After finding his place in the marketplace, Guillermo then needed to make decisions base on data on whether is it was wise to continue. Computing measures of profitability and a break even analysis will determine weather or not this will be a feasible option. If the determination is to continuing operating, the control system will allow Guillermo Furniture to stay on track. Influence of Cost Relationships and Behaviors on Decision
Words: 1597 - Pages: 7
dollars = [total FC / (selling price per ticket - VC per ticket)] * (selling price per ticket) or total FC/ CM ratio * Margin of Safety = Expected Sales - Breakeven in Sales Dollars Results | 2003 | 2004 | 2006 | Break even # units | 4,535 | 5,000 | 7473 | Break even sales dollars | 7,323.994 | 7,606.797 | 11,495.82 | Margin of Safety | 1259 | 495.2 | (1259) | Calculations 2003 Breakeven Units: FC (3250) / CM (.71672) = 4,534.546 Breakeven sales: Total FC (3250) / CM ratio
Words: 1507 - Pages: 7
Hallstead Jewelers – Individual assignment ACCT 503 – NMSU – Mills – Spring, 2016 When I lived in San Antonio, I was a loyal customer to James Avery Jewelers [ http://www.jamesavery.com/ ]. I believe the company demonstrates how a jeweler can adapt and grow over decades by changing product lines, expanding on line, etc. You might find the website informative about the history of the company, types of product, and ways to market that could help you spice up this case. Maximum points:
Words: 1675 - Pages: 7
Gross Margin and Contribution Margin…………………………………………...3 CVP Relationship in Graphic Form……………………………………………….3 CM Ratio. …………………………………………………………………………3 Application of CVP Concepts……………………………………………………..4 Importance of CM…………………………………………………………………4 Break-even Analysis………………………………………………………………4 Target Profit Analysis…………………………………………………………….5 The Margin of Safety……………………………………………………………..6 Degree of Operating Leverage…………………………………………………....6 Major Assumptions of CVP Analysis…………………………………………….7 Difference
Words: 1268 - Pages: 6
(CVP) ANALYSIS Upon a successful completion of this chapter, you should be able to: ← distinguish between contribution margin and gross margin ← prepare and interpret a contribution income statement ← compute a break even point in total birrs and total units using the contribution margin approach and the equation approach ← Prepare a cost-volume –profit graph, and explain how it is used. ← Applying CVP analysis to determine the effect on profit
Words: 10865 - Pages: 44
