Chapter 7: Break Even Analysis Flashcards
1
Q
What is breaking even?
A
When you make neither a profit or a loss.
2
Q
What is the calculation for break-even?
A
B = F/(p-v)
3
Q
What is the margin of safety?
A
Difference between the number of units you predict to sell and the number of units required to match your break-even point.
4
Q
What is the calculation for MoS?
A
M = Predicted sales volume - break even sales volume
5
Q
What does C/S stand for?
A
Contribution to sales
6
Q
What is the calculation for contribution to sales ratio?
A
C/S = (P-V) / P
7
Q
How do you calculate the Break-even Revenue?
A
Break - even revenue = F / Contribution to sales ratio
8
Q
A
8
Q
A
