making profit
louise
Registered Posts: 49 Regular contributor ⭐
i don understand, the formula of :
i.e:
how much sale to make x profit.
or how much profit if sales are 66 a month at £400 ea.
how is this done?????
i.e:
how much sale to make x profit.
or how much profit if sales are 66 a month at £400 ea.
how is this done?????
0
Comments

Hello,
Lets say you needed to calculate the sales required in order to generate a profit of £50 and had the following information,
At Breakeven point Sales = £400, Fixed Costs = £200
To calculate:
£200/£400 = 0.5
Required Profit £50/0.5 = £100
Add sales value at Breakeven Point £400+£100 = £500
Therefore the sales value required to generate the £50 Profit = £500
Hope this is of some use :001_smile:0 
thanks for that!!!
helpfull0 
helo!!
i was studying last night and, i came across this formula for making profit::
FC + Pofit
_________ = Y
Contribution per unit
Profit/Y = x
Breakeven + x = outcome needed
is this correct or is the other way it???0 
Hi :001_smile:
Both formulas are correct and can be used depending on what information you have been given, the second formula I think is as the calculation I first gave. The first formula the value Y should result in number of units needed to sell in order to generate the required profit. So if using my first figures:
Selling Price £20
less:Variable Cost £(10)
Contribution per unit £10
Fixed Costs + Required Profit (£200 + £50) = £250
Contribution per unit = £10
£250 / £10 = 25units (Value of Y)
25units X Selling Price £20 = £500
Hope this makes sense0 
yes thanks! ill print it out and add to my notes
:thumbup1:0
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