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CVP

Ssachje9y ago
Variable cost 40 Fixed cost 10 Budgeted sales 12000 C/S ratio 60% How much is breakeven point in units? Can somebody help me please with this question?asap
kengarrettkengarrettTutor9y ago#1
I'm not going to simply tell you the answer to a relatively straightforward question just to (perhaps) help your with your homework. Let me know some of your thought processes. Show me the answer and how you got there and I'll help.
Ssachje9y ago#2
Fixed cost = contribution= 10 12000/0,60=20000 20000/10=2000
kengarrettkengarrettTutor9y ago#3
You got the right answer, but I'm not sure it it's luck or judgement.My way would be something like: If the C/S ratio is 0.6, the VC/S ratio must be 0.4 VC = 40, so VC/S = 40/S = 0.4. SP must be 100, VC, 40 and contribution 60 Total fixed cost budgeted = 12,000 x 10 = 120,000 BEP = 120,000/60 = 2000.
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