Yahoo Answers is shutting down on May 4th, 2021 (Eastern Time) and the Yahoo Answers website is now in read-only mode. There will be no changes to other Yahoo properties or services, or your Yahoo account. You can find more information about the Yahoo Answers shutdown and how to download your data on this help page.
Trending News
Break Even Point in Sales?
Sales $2,000,000
Variable Costs $1,200,000
Contribution Margin $800,000
$2,000,000
Sales Mix $4,000,000 $0.50
Contribution Margin Ratio $800,000
$2,000,000 $0.40
Total Fixed Costs = 800,000
I just need a double check that I am figuring the break even point in sales correctly.
Fixed cost / 1-(contribution margin / total sales) equal break even sales revenue
800,000 / 1 - (800,000 / 2,000,000) = $799,999.60
Is this correct? If not where is my error? Thanks
1 Answer
- 8 years agoFavorite Answer
The breakeven point in sales is FC/(Contribution Margin/Sales), don't subtract the denominator from 1!
Good luck!
Source(s): Accountant