VOLUME-COST-PROFIT (REVENUE AND TOTAL COST)
This program is similar to Module 9BA. However, it will calculate the break-even revenue when unit price
and unit variable costs are not available. Instead, total variable cost as a constant proportion of total
revenue is necessary, in addition to total fixed costs.
This program is useful where several products with different prices are produced so that price per unit and
variable cost per unit are not identifiable. It will yield the same results as Module 9BA if the total variable
cost as a percentage of revenue is the same as unit variable cost as a percentage of price in Module 9BA.
INPUTS (will appear in blue):
1) Total variable cost as a proportion of total revenue is entered in
cell D31. (Enter number as a decimal.)
2) Total fixed cost is entered in cell D32.
3) Required profit is entered in cell E54.
4) Revenue at which DOL (degree of operating leverage) is to be
calculated is entered in cell E60.
Sample data have been entered as an example.
Variable cost/revenue 0.80
Total fixed cost 20,000
Break-even revenue 100,000
Rev. Fixed Cost Cost Cost Profit
0 20,000 0 20,000 -20,000
50,000 20,000 40,000 60,000 -10,000
100,000 20,000 80,000 100,000 0
150,000 20,000 120,000 140,000 10,000
200,000 20,000 160,000 180,000 20,000
250,000 20,000 200,000 220,000 30,000
300,000 20,000 240,000 260,000 40,000
350,000 20,000 280,000 300,000 50,000
400,000 20,000 320,000 340,000 60,000
Revenue needed to achieve required profit:
Required profit: 15,000
Revenue needed: 175,000