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The management of Brockly’s Clothing and Design Store said that female jeans trousers are their main seller.  They do not understand the principles of breakeven analysis and are not sure at what point they are able to register a profit.  Your manger has asked you to explain how useful breakeven analysis can be in assisting the organisation in determining the best output.      

Task 5 – this task must be completed in a supervised classroom you are not allowed to liaise with your colleagues. However you may consult your supervisor if you have any queries

Use the information that is given to complete the table below. Put a negative sign before the loss figures.  Show all your calculations

1. Brockely’s Clothing and Design Store budgeted selling price for female jeans to their customers is £12 per jeans, the budgeted variable cost per jeans £7 and the budgeted fixed cost is £7,000. Jeans | Total| Variable| Fixed| Total| Profit/1oss/ | (units)| Revenue| Costs| Costs| Costs        | Breakeven     |  |  |  |  |  |  |

100|  |  |  |  |  |
200|  |  |  |  |  |
300|  |  |  |  |  |
400|  |  |  |  |  |
500|  |  |  |  |  |
600|  |  |  |  |  |
700|  |  |  |  |  |
800|  |  |  |  |  |
900|  |  |  |  |  |
1000|  |  |  |  |  |
1100|  |  |  |  |  |
1200|  |  |  |  |  |
1300|  |  |  |  |  |
1400|  |  |  |  |  |
1500|  |  |  |  |  |
1600|  |  |  |  |  |
1700|  |  |  |  |  |

Use the information above to construct and label your own break even graph.  Shade the area that shows breakeven on the table.

1. What does the term ‘break even’ means?
2. How many jeans would they now needed to sell to break-even? 3. Show the calculation by using  the formula  

2. Brockely’s Clothing and Design Store wishes to improve their breakeven point and changed their selling price to £15 per unit and is able to reduce...
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