Break-even Point. Sales at which total revenue earned equals total costs incurred (TR=TC). TR = Selling Price x Quantity TC = Fixed Cost + (Variable Cost/unit x Quantity) BEQ = FC/SP – VC Break even Analysis Margin of Safety What is the importance of BEP in a Business?
Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.
Break even Analysis
What is the importance of BEP in a Business?
What are the shortcomings of BEP Analysis ?
- Marketing cost : Rs. 3 mn
- Executive Salaries : Rs. 2 mn
- Rent, Electricity : Rs. 1 mn
- Office & Admin Exp : Rs. 2 mn
Total Fixed cost : Rs. 8 mn
- Mfg cost : Rs. 70/-
- Labour cost : Rs. 30/-
Working capital = Current Assets – Current Liabilities
Sales / Working capital
Current Assets / Current Liabilities
Receivables/ Annual Sales/ 365 days
Cost of Goods sold/ Inventory