COST ACCOUNTING
COST VOLUME PROFIT ANALYSIS
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Fixed costs/c/s ratio
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Variable costs/contribution per unit
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Variable costs /c/s ratio
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Fixed costs/ contribution per unit
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Detailed explanation-1: -To calculate the break-even point in units use the formula: Break-Even point (units) = Fixed Costs ÷ (Sales price per unit – Variable costs per unit) or in sales dollars using the formula: Break-Even point (sales dollars) = Fixed Costs ÷ Contribution Margin. Here’s What We’ll Cover: What Is the Break-Even Point?
Detailed explanation-2: -Break-even Sales = Total Fixed Costs / (Contribution Margin) Contribution Margin = 1-(Variable Costs / Revenues)
Detailed explanation-3: -A company’s breakeven point is the point at which its sales exactly cover its expenses. Fixed Costs ÷ (Price-Variable Costs) = Breakeven Point in Units.
Detailed explanation-4: -In accounting, the breakeven point is calculated by dividing the fixed costs of production by the price per unit minus the variable costs of production. The breakeven point is the level of production at which the costs of production equal the revenues for a product.