Terms & Definitions
Ture or false, contribution and profit are the same thing
What is False
Price per unit - Variable cost
What is Contribution per unit formula
True or false, the level of demand can change
What is true?
The Break-even analysis is useful for businesses with this many products in a single market
What is one product?
This refers to the amount of money products contribute to fixed cost
What is Contribution cost
Total Revenue- Total variable cost
What is the total contribution formula?
True or false, Break-even analysis looks at external factors
True or false, Break-even analysis assume all stock will be sold?
False(it is a limitation)
This is a method by which a firm analyzes how many units of a product it needs to sell
What is Break-even analysis
Fixed cost/Contribution cost
or
Fixed cost/(price - average variable costs)
what is the break-even formula
This is the difference in short-term and long-term profits
What is changes in pricing?
How many products can the break-even analysis focus on at once
What is one
Contribution cost is measured by this
What is dollars
current output - Break even quantity
what is the Margin of Safety formula?
True or false, break-even analysis includes risk
What is false?
The break-even analysis is not very useful for a firm with different products because of this
What is because the break-even analysis focuses only on one product?
This is what we get when the total costs equal the total revenue
What is a break even point
(Contribution per unit)x(number of units sold)
What is the total contribution formula
This only represents the position of a business at a particular time
What is the break-even analysis
Round to the next whole number if the answer is a decimal because of this
What is not being able to sell 1/2 of a product.