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Fixed Costs Variable Cost Per Unit Units Produced Selling Price Per Unit

This document provides a formula sheet for break even analysis. It lists the key components needed, including fixed costs, variable costs per unit, units produced, and selling price per unit. It then shows the formulas for calculating total variable costs, total costs, and total revenue. The document explains that break even is where total profits equal zero. It provides the formula for calculating the break even point in units and also includes a formula for determining the quantity needed to reach a specific profit amount using contribution margin.

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Tayyab Hanif Gill
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137 views1 page

Fixed Costs Variable Cost Per Unit Units Produced Selling Price Per Unit

This document provides a formula sheet for break even analysis. It lists the key components needed, including fixed costs, variable costs per unit, units produced, and selling price per unit. It then shows the formulas for calculating total variable costs, total costs, and total revenue. The document explains that break even is where total profits equal zero. It provides the formula for calculating the break even point in units and also includes a formula for determining the quantity needed to reach a specific profit amount using contribution margin.

Uploaded by

Tayyab Hanif Gill
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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BMGT258 Enterprise Planning and Analysis

Break Even Analysis Formula Sheet

We may need:

 Fixed Costs
 Variable Cost per Unit
 Units Produced
 Selling Price per Unit

Total Variable Costs = Variable Cost per unit * Units Produced

Total Costs = Fixed Costs + (Variable Cost * Units Produced)

Total REVENUE = Units Produced * Selling Price per Unit

Total PROFITS = {Unit Produced * Selling Price per Unit} – {Fixed Costs + (Variable Cost * Units Produced)}

Mathematically we can break this down:

At BREAK EVEN…………… Total Profits = ZERO

ZERO = {Unit Produced * Selling Price per Unit} – {Fixed Costs + (Variable Cost * Units Produced)}

Therefore..

Unit Break Even (ZERO Profit):

QBEP  

Contribution Margin

Q@ specific profit amount  



Note: With this formula you could also solve for Selling Price given a desired profit and
quantity.

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