Break-even Analysis

A company wants to begin selling its ales in the upcoming fiscal year. They want to know how many ales they will have to sell

Input data
Price per unit of ale $ 10.00
Proposed quantity 100
Gross profit
Cost of goods sold:
Raw materials 1.50
Packing materials 0.60
Direct labour 1.25
Direct manufacturing overhead 0.40
Shipping 0.15
Total unit cost of goods
Cost of goods sold
Net profit

Fixed expenses:
Machinery depreciation 70.00
Office rent 164.50
Office supplies 88.00
Office salaries 165.50
Total fixed expenses

Net income before taxes

many ales they will have to sell in order to break-even on its operational expenses.

Contribution Graphing the BEP

Contribution (Unit Price-Unit Variable Cost) Units Total Costs
Margin (Contribution/Price)

Break-even
In Units (Total Fixed Cost/Contribution)
In Sales (BE in Units*Unit Price)
phing the BEP
Revenue
Break-even Analysis
A company wants to begin selling its ales in the upcoming fiscal year. They want to know how many ales they will have to sell

Input data
Price per unit of ale $ 10.00
Proposed quantity 100
Gross profit $ 1,000.00
Cost of goods sold:
Raw materials 1.50
Packing materials 0.60
Direct labour 1.25
Direct manufacturing overhead 0.40 1
Shipping 0.15 0.9
Total unit cost of goods 3.90 0.8
Cost of goods sold 390 0.7
Net profit $ 610.00 0.6
0.5
Fixed expenses: 0.4
Machinery depreciation 70.00
0.3
Office rent 164.50
0.2
Office supplies 88.00
0.1
Office salaries 165.50
0
Total fixed expenses 488.00 0 10 20 30 40

Net income before taxes $ 122.00

many ales they will have to sell in order to break-even on its operational expenses.

Contribution Graphing the BEP

Contribution (Unit Price-Unit Variable Cost) $ 6.10 Units Total Costs
Margin (Contribution/Price) 61.0% 100 $ 878.00
0
Break-even 10
In Units (Total Fixed Cost/Contribution) 80 20
In Sales (BE in Units*Unit Price) $ 800.00 30
40
1 50
0.9 60
0.8 70
0.7 80
0.6 90
0.5 100
0.4
110
120
0.3
130
0.2
140
0.1
150
0
0 10 20 30 40 50 60 70 80 90 00 10 20 30 40 50 60 70 80 90 00 160
1 1 1 1 1 1 1 1 1 1 2
170
Costs Revenue 180
190
200
phing the BEP
Revenue
$ 1,000.00