Name 2 & What is the formala for calcalating the variabde cost ratio? Sepplen P4
ID: 2398268 • Letter: N
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Name 2 & What is the formala for calcalating the variabde cost ratio? Sepplen P4-4 . What is the Sormela for calculating the break-even poinat in sales revenue dollars? Chap! P5-1 P5-3 P5-4 10. What is the formula for cakculating the break-even point in units? Sug I1. How can the break-evem formula be altered to calculate the number of units that must be sold to achieve desired level of income? 12. Why might a besisess wish to lower its break-even points? How would it go about lowering the break-even point? 13. What effect would you expect the mechanization and automation of production processes to have on the break- even point? 14. My CVP case study (Case Study 2) is due on what date? 15. Where will you complete your case study? What day will you being your case study? How long do you think the case study will take you?Explanation / Answer
Formula 8) Variable Cost Ratio (Variable Cost/Sales)*100 9) Breakeven Sales(Dollars) Fixed Cost/Contribution Margin Ratio Contribution Margin Per Unit Sales Price Per Unit-Variable Cost Per Unit Contribution Margin Ratio (Contribution Margin Per Unit/Sales Price Per Unit) 10) Breakeven Sales(Units) Fixed Cost/Contribution Margin Per Unit 11) Breakeven Point with expected Profit (Fixed Cost+Desired Profit)/Contribution Margin Per Unit 12) Breakeven analysis is a vital tool for the management accountant. Breakeven point is that point where total cost is equal to total salesThe lower the breakeven point is better. A lower breakeven point implies that that organisation can survive at lower level of activity. Break even point can be reduced by increasing contribution margin.Contribution Margin can be increased by reducing variable cost,increasing sales per unit.
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