Btec Business Unit 1 P2 M Task

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Break - even point

A firm that ‘Breaks – even’ make a profit or a loss on it product it is producing.

Formula to use for break even

Breakeven = Fixed Costs
Point (Selling Price – Variable Cost Per Unit)

£250000
(£1.50 – 70p) 80p = £31500 units

E.g.)
|0utput |FC |VC |TC |TR |Profit | |0 |£250000 |0 |£250000 |£0 |-£250000 | |50000 |£250000 |£35000 |£285000 |£75000 |-£210000 | |100000 |£250000 |£70000 |£320000 |£150000 |-£170000 | |150000 |£250000 |£105000 |£355000 |£225000 |-£130000 | |200000 |£250000 |£140000 |£390000 |£300000 |-£90000 | |250000 |£250000 |£175000 |£425000 |£375000 |-£50000 | |300000 |£250000 |£210000 |£460000 |£450000 |-£10000 | |350000 |£250000 |£245000 |£495000 |£525000 |£30000 | |400000 |£250000 |£280000 |£530000 |£600000 |£70000 | |450000 |£250000 |£315000 |£565000 |£675000 |£110000 | |500000 |£250000 |£350000 |£600000 |£750000 |£150000 |...
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