Breakeven and Performance Analysis

Description
The formula for break even analysis is as follows:
Break Even Quantity = Fixed Costs / (Sales Price per Unit – Variable Cost Per Unit)
Where:
Fixed Costs are costs that do not change with varying output (e.g., salary, rent, building machinery).
Sales Price per Unit is the selling price (unit selling price) per unit.
Variable Cost per Unit is the variable costs incurred to create a unit.
It is also helpful to note that sales price per unit minus variable cost per unit is the contribution margin per unit. For example, if a book’s selling price is $100 and its variable costs are $5 to make the book, $95 is the contribution margin per unit and contributes to offsetting the fixed costs.The formula for break even analysis is as follows:
Break Even Quantity = Fixed Costs / (Sales Price per Unit – Variable Cost Per Unit)
Where:
Fixed Costs are costs that do not change with varying output (e.g., salary, rent, building machinery).
Sales Price per Unit is the selling price (unit selling price) per unit.
Variable Cost per Unit is the variable costs incurred to create a unit.
It is also helpful to note that sales price per unit minus variable cost per unit is the contribution margin per unit.