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Break Even Analysis for Various Businesses

This document provides information and examples about break even analysis. It defines key terms like margin, markup, variable costs, and fixed costs. It then shows examples of calculating break even units and dollars for different businesses including a sandwich shop, DVD/CD shops, and a restaurant. The restaurant examples demonstrate how changing the margin and adding new equipment costs affects the break even calculation. Another example looks at break even analysis for a plumber's business. Finally, there is an assignment calculating profit for a plumber given a list of job totals for the year.

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107 views12 pages

Break Even Analysis for Various Businesses

This document provides information and examples about break even analysis. It defines key terms like margin, markup, variable costs, and fixed costs. It then shows examples of calculating break even units and dollars for different businesses including a sandwich shop, DVD/CD shops, and a restaurant. The restaurant examples demonstrate how changing the margin and adding new equipment costs affects the break even calculation. Another example looks at break even analysis for a plumber's business. Finally, there is an assignment calculating profit for a plumber given a list of job totals for the year.

Uploaded by

api-280430685
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as XLS, PDF, TXT or read online on Scribd

Break Even Analysis Assig

How Much do we need to sell to Bre


Margin

The amount we charge over what we pay.

Markup

The % of what the margin is relative to what we paid


1-(cost/selling price)

Variable cost

1-markup(as a percentage)
What we pay for each unit we sell(dollar amount)

Fixed costs

Costs that do not change regardless of whether we sell anything

Fixed costs per year


Loan to pay computer
Website costs
Total

1000
66
1066
75

Monthly Charge for services


Costs per month to provide service
gas to get there and back

10

margin

Break Even

65.00

16.4

If the service has 50 clients that it does bookkeepping for each month, how much will they earn in
In Store DVD/CD Shop
Annual Fixed Costs
Rent
payroll
utilities
insurance
Total
Average cost/cd/dvd

24000
16640
6000
2000
$48,640.00
40%

Margin

60%

Break Even

81066.67

If sales are $120000 per year how much will they earned?

Online DVD/CD Shop


Annual Fixed Costs
Rent
website
utilities
insurance
total

0
200
0
0
$200.00

Average cost/cd/dvd

40%

Margin

60%

Break Even

120000*0.6-48,0640

333.3333333333

If sales are $120000 per year how much will they earned?

120000*0.6-200

Break Even Analysis

Restaurant
Fixed costs monthly
Rent
Payroll
Utilities
Insurance
Equipment Loans
Total
Daily Fixed costs
Margin
Break even per day

2000
4000
700
300
300
7300
$

243.33
0.75

243.33/0.75

324.44

If they decide they need to be more competitive and change the margin to .65, what will the break
Fixed costs monthly
Rent
Payroll
Utilities
Insurance
Equipment Loans
Total

2000
4000
700
300
300
$7,300.00

Daily Fixed costs


Margin

243.33
0.65

Break even per day

374.35

If they purchase new equipment that will allow them to provide better service
and must pay an extra $100/month for it what will the new B.E. be?
Fixed costs monthly
Rent
Payroll
Utilities
Insurance
Equipment Loans
Total

2000
4000
700
300
400
$7,400.00

Daily Fixed costs


margin

246.67
0.65

Break even per day

379.49

Comment on the net result these two moves have had on the business.

Plumber
Fixed costs Yearly
Truck
Equipment Loans
Desired annual sala
Gas
Total

10000
2400
50000
2500
64900

Weekly Fixed costs


Margin
Break Even Per Week

$1,248.08
0.5
$

2,496.16

If the plumber lands a job for a $10000 bathroom, how many weeks can he go without landing ano
If the plumber is able to land the following jobs:
Bathrooms

Total

80000
30000
15000
50000
48000
40000
$263,000.00

How much profit will he make over the year?

$263,000.00

Kitchens

8
4
3
5
6
2

10000
7500
5000
10000
8000
20000

Even Analysis Assignment

do we need to sell to Break Even?

example

Sandwich
Sandwich
cost
selling Price
0.95
$3.25

Fixed costs/Margin=break even units


Fixed costs/Markup=break even in dollars

how much will they earn in 1 year?

Margin
$2.30
Fixed Cost
Rent/Day
$
10.00
$
10.00

Markup
0.707692

B/E
4.3
$ 14.13

000*0.6-48,0640

000*0.6-200

$23,360.00

$71,800.00

n to .65, what will the break even be?

243.33/0.65

$ 374.35

These moves had a negative outcome, by providing a better service, they are paying m

n he go without landing another job?

4.006 3 weeks

e, they are paying more.

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