SlideShare a Scribd company logo
WELCOME
Presentation on
Break Even Analysis
CREATED BY
MD: AMAN UDDIN
REG. NO: 2014731030
DEPT. OF BUSINESS ADMINISTRATION
SHAHJALAL UNIVERSITY OF SCIENCE AND TECHNOLOGY
Definition of BEA:
 A technique that analyzes the relationship
between total revenue and total cost to determine
profitability at various levels of output.
 The quantity at which total revenue and total cost
are equal & beyond which profit occurs.
BEA depends on following variables:
 Fixed Cost:
The sum of all costs required to produce the first unit of a product.
This amount does not vary as production increases or decreases, until
new capital expenditures are needed.
 Variable Unit Cost:
Costs that vary directly with the production of one additional unit.

Expected Unit Sales:
Number of units of the product projected to be sold over a specific
period of time
 Unit Price:
The amount of money charged to the customer for each unit of a
product or service.
BEA depends on following variables:
 Total Variable Cost:
The product of expected unit sales and variable unit cost.
(Expected Unit Sales * Variable Unit Cost )
 Total Cost:
The sum of the fixed cost and total variable cost for any given level of production.
(Fixed Cost + Total Variable Cost )
 Total Revenue:
The product of expected unit sales and unit price.
(Expected Unit Sales * Unit Price )
 Profit (or Loss):
The monetary gain (or loss) resulting from revenues after subtracting all associated
costs. (Total Revenue - Total Costs)
BEA depends on following variables:
 BREAK EVEN POINT:
Number of units that must be sold in order to produce a profit of zero
(but will recover all associated costs).
 Break Even Point (IN UNIT)= Fixed Cost /S. Price- Variable Unit
Cost
 Break Even Point (in Taka)=Fixed Cost/ S. Price-Variable unit
Cost*Units
Break-Even Analysis Curve
Costs/Revenue
Output/Sales
FC
VC
TCTR TR
Q1
A
B
C
Break-Even Analysis Curve
Costs/Revenue
Output/Sales
FC
VC
TCTR (p = £2)
Q1
Loss
Profit
B
USES OF BREAK EVEN ANALYSIS
 Helpful in deciding the minimum quantity of sales
 Helpful in the determination of tender price
 Helpful in examining effects upon organization’s profitability
 Helpful in deciding about the substitution of new plants
 Helpful in sales price and quantity
 Helpful in determining marginal cost
THANK YOU

More Related Content

What's hot

Cost Classification(fixed cost and variable cost) and BEP
Cost Classification(fixed cost and variable cost) and BEPCost Classification(fixed cost and variable cost) and BEP
Cost Classification(fixed cost and variable cost) and BEP
Prosenjit Banerjee
 
Marginalcosting
MarginalcostingMarginalcosting
Marginalcosting
JOYAL SAJI
 
Decision involving Alternate choices
Decision involving Alternate choicesDecision involving Alternate choices
Decision involving Alternate choices
Chitranshu Shukla
 
Theory of the firm
Theory of the firmTheory of the firm
Theory of the firm
12nakaka
 
Break even analysis
Break even analysisBreak even analysis
Break even analysis
tigerjayadev
 
Cost concepts & classification
Cost concepts & classificationCost concepts & classification
Cost concepts & classification
Manish Kaushik
 
UNDERSTANDING MARGINAL COSTING
UNDERSTANDING MARGINAL COSTINGUNDERSTANDING MARGINAL COSTING
UNDERSTANDING MARGINAL COSTING
ambarish_9
 
Marginal costing
Marginal costing Marginal costing
Marginal costing
student
 
Different types of costs PPT ON COST ACCOUNTANCY MBA
Different types of costs PPT ON COST ACCOUNTANCY MBADifferent types of costs PPT ON COST ACCOUNTANCY MBA
Different types of costs PPT ON COST ACCOUNTANCY MBA
Babasab Patil
 
Types of cost
Types of costTypes of cost
Types of cost
mahesh patil
 
Cost and management accounting
Cost and management accountingCost and management accounting
Cost and management accounting
Accounting_group
 
Marginal costing
Marginal costingMarginal costing
Marginal costing
Dr. Sushil Bansode
 
Accounts : Marginal Costing
Accounts : Marginal CostingAccounts : Marginal Costing
Accounts : Marginal Costing
Sanchit
 
Cost....
Cost....Cost....
Cost concept and analysis
Cost concept and analysisCost concept and analysis
Cost concept and analysis
rahul kapoliya
 
ECONOMICS COST CONCEPT
ECONOMICS COST CONCEPTECONOMICS COST CONCEPT
ECONOMICS COST CONCEPT
Shubham Agrawal
 
Economics
EconomicsEconomics
Marginal costing
Marginal costing Marginal costing
Marginal costing
Jathurika Mathyinparasan
 
Marginal costing
Marginal costingMarginal costing
Marginal costing
Priyanka Jain
 
cost analysis
cost analysiscost analysis
cost analysis
akash sen
 

What's hot (20)

Cost Classification(fixed cost and variable cost) and BEP
Cost Classification(fixed cost and variable cost) and BEPCost Classification(fixed cost and variable cost) and BEP
Cost Classification(fixed cost and variable cost) and BEP
 
Marginalcosting
MarginalcostingMarginalcosting
Marginalcosting
 
Decision involving Alternate choices
Decision involving Alternate choicesDecision involving Alternate choices
Decision involving Alternate choices
 
Theory of the firm
Theory of the firmTheory of the firm
Theory of the firm
 
Break even analysis
Break even analysisBreak even analysis
Break even analysis
 
Cost concepts & classification
Cost concepts & classificationCost concepts & classification
Cost concepts & classification
 
UNDERSTANDING MARGINAL COSTING
UNDERSTANDING MARGINAL COSTINGUNDERSTANDING MARGINAL COSTING
UNDERSTANDING MARGINAL COSTING
 
Marginal costing
Marginal costing Marginal costing
Marginal costing
 
Different types of costs PPT ON COST ACCOUNTANCY MBA
Different types of costs PPT ON COST ACCOUNTANCY MBADifferent types of costs PPT ON COST ACCOUNTANCY MBA
Different types of costs PPT ON COST ACCOUNTANCY MBA
 
Types of cost
Types of costTypes of cost
Types of cost
 
Cost and management accounting
Cost and management accountingCost and management accounting
Cost and management accounting
 
Marginal costing
Marginal costingMarginal costing
Marginal costing
 
Accounts : Marginal Costing
Accounts : Marginal CostingAccounts : Marginal Costing
Accounts : Marginal Costing
 
Cost....
Cost....Cost....
Cost....
 
Cost concept and analysis
Cost concept and analysisCost concept and analysis
Cost concept and analysis
 
ECONOMICS COST CONCEPT
ECONOMICS COST CONCEPTECONOMICS COST CONCEPT
ECONOMICS COST CONCEPT
 
Economics
EconomicsEconomics
Economics
 
Marginal costing
Marginal costing Marginal costing
Marginal costing
 
Marginal costing
Marginal costingMarginal costing
Marginal costing
 
cost analysis
cost analysiscost analysis
cost analysis
 

Similar to Break even analysis by aman u mahbub

Marginal cost & cost sheet ppt 1
Marginal cost & cost sheet ppt  1Marginal cost & cost sheet ppt  1
Marginal cost & cost sheet ppt 1
Vinod Panchal
 
A presentation on break even analysis and its importance for an industry
A presentation on break even analysis and its importance for an industryA presentation on break even analysis and its importance for an industry
A presentation on break even analysis and its importance for an industry
abdus sobhan
 
Break Even Analysis
Break Even AnalysisBreak Even Analysis
Break Even Analysis
yogesh raghuwanshi
 
Break-even Analysis
Break-even AnalysisBreak-even Analysis
Break-even Analysis
Alka Srivastava
 
Break even analysis
Break even analysisBreak even analysis
Break even analysis
shubham mandloi
 
Cost volume profit analysis
Cost volume profit analysisCost volume profit analysis
Cost volume profit analysis
Nazar Mohammed
 
Cost volume-profit (cvp)
Cost volume-profit (cvp)Cost volume-profit (cvp)
Cost volume-profit (cvp)
Jessy Chong
 
Ppt12
Ppt12Ppt12
Ppt12
Ppt12Ppt12
Cost accounting
Cost accountingCost accounting
Cost accounting
Chaitanya Salunke
 
Managerial Economics
Managerial EconomicsManagerial Economics
Managerial Economics
JisjissyChandran
 
breck even point cost management and accounting
breck even point cost management and accountingbreck even point cost management and accounting
breck even point cost management and accounting
akashdhewale87
 
UNIT 2 BUSINESS ECONOMICS PPT.pptx
UNIT 2 BUSINESS ECONOMICS PPT.pptxUNIT 2 BUSINESS ECONOMICS PPT.pptx
UNIT 2 BUSINESS ECONOMICS PPT.pptx
AshishPrabakaran
 
Cost analysis
Cost analysisCost analysis
Cost analysis
Barbi_89
 
2. Cost Volume Profit Analysis - a tool for decision making
2. Cost Volume Profit Analysis - a tool for decision making2. Cost Volume Profit Analysis - a tool for decision making
2. Cost Volume Profit Analysis - a tool for decision making
SimmiAgrawal8
 
11 theory of cost
11 theory of cost11 theory of cost
11 theory of cost
malikjameel1986
 
Cvp
CvpCvp
Chap4
Chap4Chap4
Chap4
Shu Shin
 
Chap4
Chap4Chap4
Chap4
Shu Shin
 
Ppt for economics
Ppt for economicsPpt for economics
Ppt for economics
Insharashid3
 

Similar to Break even analysis by aman u mahbub (20)

Marginal cost & cost sheet ppt 1
Marginal cost & cost sheet ppt  1Marginal cost & cost sheet ppt  1
Marginal cost & cost sheet ppt 1
 
A presentation on break even analysis and its importance for an industry
A presentation on break even analysis and its importance for an industryA presentation on break even analysis and its importance for an industry
A presentation on break even analysis and its importance for an industry
 
Break Even Analysis
Break Even AnalysisBreak Even Analysis
Break Even Analysis
 
Break-even Analysis
Break-even AnalysisBreak-even Analysis
Break-even Analysis
 
Break even analysis
Break even analysisBreak even analysis
Break even analysis
 
Cost volume profit analysis
Cost volume profit analysisCost volume profit analysis
Cost volume profit analysis
 
Cost volume-profit (cvp)
Cost volume-profit (cvp)Cost volume-profit (cvp)
Cost volume-profit (cvp)
 
Ppt12
Ppt12Ppt12
Ppt12
 
Ppt12
Ppt12Ppt12
Ppt12
 
Cost accounting
Cost accountingCost accounting
Cost accounting
 
Managerial Economics
Managerial EconomicsManagerial Economics
Managerial Economics
 
breck even point cost management and accounting
breck even point cost management and accountingbreck even point cost management and accounting
breck even point cost management and accounting
 
UNIT 2 BUSINESS ECONOMICS PPT.pptx
UNIT 2 BUSINESS ECONOMICS PPT.pptxUNIT 2 BUSINESS ECONOMICS PPT.pptx
UNIT 2 BUSINESS ECONOMICS PPT.pptx
 
Cost analysis
Cost analysisCost analysis
Cost analysis
 
2. Cost Volume Profit Analysis - a tool for decision making
2. Cost Volume Profit Analysis - a tool for decision making2. Cost Volume Profit Analysis - a tool for decision making
2. Cost Volume Profit Analysis - a tool for decision making
 
11 theory of cost
11 theory of cost11 theory of cost
11 theory of cost
 
Cvp
CvpCvp
Cvp
 
Chap4
Chap4Chap4
Chap4
 
Chap4
Chap4Chap4
Chap4
 
Ppt for economics
Ppt for economicsPpt for economics
Ppt for economics
 

Recently uploaded

Artificial Intelligence, Data and Competition – SCHREPEL – June 2024 OECD dis...
Artificial Intelligence, Data and Competition – SCHREPEL – June 2024 OECD dis...Artificial Intelligence, Data and Competition – SCHREPEL – June 2024 OECD dis...
Artificial Intelligence, Data and Competition – SCHREPEL – June 2024 OECD dis...
OECD Directorate for Financial and Enterprise Affairs
 
Artificial Intelligence, Data and Competition – OECD – June 2024 OECD discussion
Artificial Intelligence, Data and Competition – OECD – June 2024 OECD discussionArtificial Intelligence, Data and Competition – OECD – June 2024 OECD discussion
Artificial Intelligence, Data and Competition – OECD – June 2024 OECD discussion
OECD Directorate for Financial and Enterprise Affairs
 
ServiceNow CIS-ITSM Exam Dumps & Questions [2024]
ServiceNow CIS-ITSM Exam Dumps & Questions [2024]ServiceNow CIS-ITSM Exam Dumps & Questions [2024]
ServiceNow CIS-ITSM Exam Dumps & Questions [2024]
SkillCertProExams
 
The Intersection between Competition and Data Privacy – KEMP – June 2024 OECD...
The Intersection between Competition and Data Privacy – KEMP – June 2024 OECD...The Intersection between Competition and Data Privacy – KEMP – June 2024 OECD...
The Intersection between Competition and Data Privacy – KEMP – June 2024 OECD...
OECD Directorate for Financial and Enterprise Affairs
 
Artificial Intelligence, Data and Competition – LIM – June 2024 OECD discussion
Artificial Intelligence, Data and Competition – LIM – June 2024 OECD discussionArtificial Intelligence, Data and Competition – LIM – June 2024 OECD discussion
Artificial Intelligence, Data and Competition – LIM – June 2024 OECD discussion
OECD Directorate for Financial and Enterprise Affairs
 
Artificial Intelligence, Data and Competition – ČORBA – June 2024 OECD discus...
Artificial Intelligence, Data and Competition – ČORBA – June 2024 OECD discus...Artificial Intelligence, Data and Competition – ČORBA – June 2024 OECD discus...
Artificial Intelligence, Data and Competition – ČORBA – June 2024 OECD discus...
OECD Directorate for Financial and Enterprise Affairs
 
The Intersection between Competition and Data Privacy – OECD – June 2024 OECD...
The Intersection between Competition and Data Privacy – OECD – June 2024 OECD...The Intersection between Competition and Data Privacy – OECD – June 2024 OECD...
The Intersection between Competition and Data Privacy – OECD – June 2024 OECD...
OECD Directorate for Financial and Enterprise Affairs
 
IEEE CIS Webinar Sustainable futures.pdf
IEEE CIS Webinar Sustainable futures.pdfIEEE CIS Webinar Sustainable futures.pdf
IEEE CIS Webinar Sustainable futures.pdf
Claudio Gallicchio
 
BRIC_2024_2024-06-06-11:30-haunschild_archival_version.pdf
BRIC_2024_2024-06-06-11:30-haunschild_archival_version.pdfBRIC_2024_2024-06-06-11:30-haunschild_archival_version.pdf
BRIC_2024_2024-06-06-11:30-haunschild_archival_version.pdf
Robin Haunschild
 
Using-Presentation-Software-to-the-Fullf.pptx
Using-Presentation-Software-to-the-Fullf.pptxUsing-Presentation-Software-to-the-Fullf.pptx
Using-Presentation-Software-to-the-Fullf.pptx
kainatfatyma9
 
The Intersection between Competition and Data Privacy – CAPEL – June 2024 OEC...
The Intersection between Competition and Data Privacy – CAPEL – June 2024 OEC...The Intersection between Competition and Data Privacy – CAPEL – June 2024 OEC...
The Intersection between Competition and Data Privacy – CAPEL – June 2024 OEC...
OECD Directorate for Financial and Enterprise Affairs
 
Prsentation for VIVA Welike project 1semester.pptx
Prsentation for VIVA Welike project 1semester.pptxPrsentation for VIVA Welike project 1semester.pptx
Prsentation for VIVA Welike project 1semester.pptx
prafulpawar29
 
The Intersection between Competition and Data Privacy – COLANGELO – June 2024...
The Intersection between Competition and Data Privacy – COLANGELO – June 2024...The Intersection between Competition and Data Privacy – COLANGELO – June 2024...
The Intersection between Competition and Data Privacy – COLANGELO – June 2024...
OECD Directorate for Financial and Enterprise Affairs
 
怎么办理(lincoln学位证书)英国林肯大学毕业证文凭学位证书原版一模一样
怎么办理(lincoln学位证书)英国林肯大学毕业证文凭学位证书原版一模一样怎么办理(lincoln学位证书)英国林肯大学毕业证文凭学位证书原版一模一样
怎么办理(lincoln学位证书)英国林肯大学毕业证文凭学位证书原版一模一样
kekzed
 
Legislation And Regulations For Import, Manufacture,.pptx
Legislation And Regulations For Import, Manufacture,.pptxLegislation And Regulations For Import, Manufacture,.pptx
Legislation And Regulations For Import, Manufacture,.pptx
Charmi13
 
Disaster Management project for holidays homework and other uses
Disaster Management project for holidays homework and other usesDisaster Management project for holidays homework and other uses
Disaster Management project for holidays homework and other uses
RIDHIMAGARG21
 
Pro-competitive Industrial Policy – LANE – June 2024 OECD discussion
Pro-competitive Industrial Policy – LANE – June 2024 OECD discussionPro-competitive Industrial Policy – LANE – June 2024 OECD discussion
Pro-competitive Industrial Policy – LANE – June 2024 OECD discussion
OECD Directorate for Financial and Enterprise Affairs
 
2 December UAE National Day - United Arab Emirates
2 December UAE National Day - United Arab Emirates2 December UAE National Day - United Arab Emirates
2 December UAE National Day - United Arab Emirates
UAE Ppt
 
原版制作贝德福特大学毕业证(bedfordhire毕业证)硕士文凭原版一模一样
原版制作贝德福特大学毕业证(bedfordhire毕业证)硕士文凭原版一模一样原版制作贝德福特大学毕业证(bedfordhire毕业证)硕士文凭原版一模一样
原版制作贝德福特大学毕业证(bedfordhire毕业证)硕士文凭原版一模一样
gpww3sf4
 
Proposal: The Ark Project and The BEEP Inc
Proposal: The Ark Project and The BEEP IncProposal: The Ark Project and The BEEP Inc
Proposal: The Ark Project and The BEEP Inc
Raheem Muhammad
 

Recently uploaded (20)

Artificial Intelligence, Data and Competition – SCHREPEL – June 2024 OECD dis...
Artificial Intelligence, Data and Competition – SCHREPEL – June 2024 OECD dis...Artificial Intelligence, Data and Competition – SCHREPEL – June 2024 OECD dis...
Artificial Intelligence, Data and Competition – SCHREPEL – June 2024 OECD dis...
 
Artificial Intelligence, Data and Competition – OECD – June 2024 OECD discussion
Artificial Intelligence, Data and Competition – OECD – June 2024 OECD discussionArtificial Intelligence, Data and Competition – OECD – June 2024 OECD discussion
Artificial Intelligence, Data and Competition – OECD – June 2024 OECD discussion
 
ServiceNow CIS-ITSM Exam Dumps & Questions [2024]
ServiceNow CIS-ITSM Exam Dumps & Questions [2024]ServiceNow CIS-ITSM Exam Dumps & Questions [2024]
ServiceNow CIS-ITSM Exam Dumps & Questions [2024]
 
The Intersection between Competition and Data Privacy – KEMP – June 2024 OECD...
The Intersection between Competition and Data Privacy – KEMP – June 2024 OECD...The Intersection between Competition and Data Privacy – KEMP – June 2024 OECD...
The Intersection between Competition and Data Privacy – KEMP – June 2024 OECD...
 
Artificial Intelligence, Data and Competition – LIM – June 2024 OECD discussion
Artificial Intelligence, Data and Competition – LIM – June 2024 OECD discussionArtificial Intelligence, Data and Competition – LIM – June 2024 OECD discussion
Artificial Intelligence, Data and Competition – LIM – June 2024 OECD discussion
 
Artificial Intelligence, Data and Competition – ČORBA – June 2024 OECD discus...
Artificial Intelligence, Data and Competition – ČORBA – June 2024 OECD discus...Artificial Intelligence, Data and Competition – ČORBA – June 2024 OECD discus...
Artificial Intelligence, Data and Competition – ČORBA – June 2024 OECD discus...
 
The Intersection between Competition and Data Privacy – OECD – June 2024 OECD...
The Intersection between Competition and Data Privacy – OECD – June 2024 OECD...The Intersection between Competition and Data Privacy – OECD – June 2024 OECD...
The Intersection between Competition and Data Privacy – OECD – June 2024 OECD...
 
IEEE CIS Webinar Sustainable futures.pdf
IEEE CIS Webinar Sustainable futures.pdfIEEE CIS Webinar Sustainable futures.pdf
IEEE CIS Webinar Sustainable futures.pdf
 
BRIC_2024_2024-06-06-11:30-haunschild_archival_version.pdf
BRIC_2024_2024-06-06-11:30-haunschild_archival_version.pdfBRIC_2024_2024-06-06-11:30-haunschild_archival_version.pdf
BRIC_2024_2024-06-06-11:30-haunschild_archival_version.pdf
 
Using-Presentation-Software-to-the-Fullf.pptx
Using-Presentation-Software-to-the-Fullf.pptxUsing-Presentation-Software-to-the-Fullf.pptx
Using-Presentation-Software-to-the-Fullf.pptx
 
The Intersection between Competition and Data Privacy – CAPEL – June 2024 OEC...
The Intersection between Competition and Data Privacy – CAPEL – June 2024 OEC...The Intersection between Competition and Data Privacy – CAPEL – June 2024 OEC...
The Intersection between Competition and Data Privacy – CAPEL – June 2024 OEC...
 
Prsentation for VIVA Welike project 1semester.pptx
Prsentation for VIVA Welike project 1semester.pptxPrsentation for VIVA Welike project 1semester.pptx
Prsentation for VIVA Welike project 1semester.pptx
 
The Intersection between Competition and Data Privacy – COLANGELO – June 2024...
The Intersection between Competition and Data Privacy – COLANGELO – June 2024...The Intersection between Competition and Data Privacy – COLANGELO – June 2024...
The Intersection between Competition and Data Privacy – COLANGELO – June 2024...
 
怎么办理(lincoln学位证书)英国林肯大学毕业证文凭学位证书原版一模一样
怎么办理(lincoln学位证书)英国林肯大学毕业证文凭学位证书原版一模一样怎么办理(lincoln学位证书)英国林肯大学毕业证文凭学位证书原版一模一样
怎么办理(lincoln学位证书)英国林肯大学毕业证文凭学位证书原版一模一样
 
Legislation And Regulations For Import, Manufacture,.pptx
Legislation And Regulations For Import, Manufacture,.pptxLegislation And Regulations For Import, Manufacture,.pptx
Legislation And Regulations For Import, Manufacture,.pptx
 
Disaster Management project for holidays homework and other uses
Disaster Management project for holidays homework and other usesDisaster Management project for holidays homework and other uses
Disaster Management project for holidays homework and other uses
 
Pro-competitive Industrial Policy – LANE – June 2024 OECD discussion
Pro-competitive Industrial Policy – LANE – June 2024 OECD discussionPro-competitive Industrial Policy – LANE – June 2024 OECD discussion
Pro-competitive Industrial Policy – LANE – June 2024 OECD discussion
 
2 December UAE National Day - United Arab Emirates
2 December UAE National Day - United Arab Emirates2 December UAE National Day - United Arab Emirates
2 December UAE National Day - United Arab Emirates
 
原版制作贝德福特大学毕业证(bedfordhire毕业证)硕士文凭原版一模一样
原版制作贝德福特大学毕业证(bedfordhire毕业证)硕士文凭原版一模一样原版制作贝德福特大学毕业证(bedfordhire毕业证)硕士文凭原版一模一样
原版制作贝德福特大学毕业证(bedfordhire毕业证)硕士文凭原版一模一样
 
Proposal: The Ark Project and The BEEP Inc
Proposal: The Ark Project and The BEEP IncProposal: The Ark Project and The BEEP Inc
Proposal: The Ark Project and The BEEP Inc
 

Break even analysis by aman u mahbub

  • 2. Presentation on Break Even Analysis CREATED BY MD: AMAN UDDIN REG. NO: 2014731030 DEPT. OF BUSINESS ADMINISTRATION SHAHJALAL UNIVERSITY OF SCIENCE AND TECHNOLOGY
  • 3. Definition of BEA:  A technique that analyzes the relationship between total revenue and total cost to determine profitability at various levels of output.  The quantity at which total revenue and total cost are equal & beyond which profit occurs.
  • 4. BEA depends on following variables:  Fixed Cost: The sum of all costs required to produce the first unit of a product. This amount does not vary as production increases or decreases, until new capital expenditures are needed.  Variable Unit Cost: Costs that vary directly with the production of one additional unit.  Expected Unit Sales: Number of units of the product projected to be sold over a specific period of time  Unit Price: The amount of money charged to the customer for each unit of a product or service.
  • 5. BEA depends on following variables:  Total Variable Cost: The product of expected unit sales and variable unit cost. (Expected Unit Sales * Variable Unit Cost )  Total Cost: The sum of the fixed cost and total variable cost for any given level of production. (Fixed Cost + Total Variable Cost )  Total Revenue: The product of expected unit sales and unit price. (Expected Unit Sales * Unit Price )  Profit (or Loss): The monetary gain (or loss) resulting from revenues after subtracting all associated costs. (Total Revenue - Total Costs)
  • 6. BEA depends on following variables:  BREAK EVEN POINT: Number of units that must be sold in order to produce a profit of zero (but will recover all associated costs).  Break Even Point (IN UNIT)= Fixed Cost /S. Price- Variable Unit Cost  Break Even Point (in Taka)=Fixed Cost/ S. Price-Variable unit Cost*Units
  • 9. USES OF BREAK EVEN ANALYSIS  Helpful in deciding the minimum quantity of sales  Helpful in the determination of tender price  Helpful in examining effects upon organization’s profitability  Helpful in deciding about the substitution of new plants  Helpful in sales price and quantity  Helpful in determining marginal cost