Break Even Point (Units) = Fixed Costs / (Selling Price – Variable Costs)
=Fixed Costs/Contribution Per Unit
=25,000/30
= 833.33 =834 Units
Break Even Point (Dollars) = Fixed Costs / Contribution Margin
Contribution Margin= (Sales price per unit – Variable costs per unit)/Sales Price per Unit
= (50-20)/50
= 30/50 = 0.6
Break Even Point (Dollars) = 25,000/0.6
= $41,666.67
Break-Even Chart
|
Units Required for Break-Even: |
833 |
|
Dollar Sales Required for Break-Even: |
$41,666.67 |
|
Variable Costs Per Unit: |
$20.00 |
|
Total Variable Costs: |
$16,660.00 |
|
Total Fixed Costs: |
$25,000.00 |
|
Months to Break-Even: |
0.8 |
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