Finance Questions? Ask a Financial Expert for Answers ASAP
Why don't you go ahead and post your question :)
If I can help, I will. If not, I'm sure another expert can work with you.
Do you have any numbers or information related to it?
Please post all of the information you have for calculating the break even point :)
Cost of Sales 56110.00
Gross Profit 162040.00
Payroll tax 11850.00
Operating expenses 85588.00
Net Income -35490.00
What specifically is needed?
I'm going to open this question to all the experts...
I need to see the full problem as it ppears in your book, but before you tyoe it all, I might have your book so kindly advise the name of the book you are using: Title, author's name, and edition. Also advise the question number and I will see if I have the book
I just cannot use the numbers above as I need to know which costs are fixed and which are variable. But anyway, to calculate the breakeven point in units you need to know the Total Fixed Costs, and the Contribution Margin.
Unit Contribution Margin (UCM) = Unit Sales Price - Variable Cost per Unit
Break-even point in units = Total Fixed Costs ÷ UCM
To calculate Break-even point in Dollars
1) Calculate the Contribution Margin Ratio (CMR) = Unit Contribution Margin ÷ Unit Sales Price (Or divide Toral Contribution Margin by Total Sales)
Break-even point in Dollars = Total Fixed Costs ÷ CMR
Hope this helps
In this case (livestock auction) unit contribution margin = Price per pound - variable cost (which include- payroll, utilities, supplies, etc..?