help with break even please
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valentino46
Registered Posts: 124 Dedicated contributor 🦉
hi guys,
could enyone advise me how to calculate the break even point using sales revenue figure given for the product.
cheers
rob
could enyone advise me how to calculate the break even point using sales revenue figure given for the product.
cheers
rob
0
Comments

Hello
As far as I know:
Sales RevenueVariable Cost = Contribution
At Break even point,
Sales RevenueVariable Cost = Fixed Cost
So, Contribution = Fixed Cost
But
Contribution = Contribution per sales revenue X Sales revenue
At Break even point:
Contribution = Contribution per sales revenue X Break even point sales revenue
So,
Contribution per sales revenue X Break even point sales revenue = Fixed cost
and again
Profit Volume ratio =( Contribution/ Sales revenue )X 100
So,
Break even point sales revenue = Fixed Cost/ PV Ratio
This is as per my understanding.
Regards
Lalita0 
hi,
thanks for the response, i have divided the sales revenue figure by sellling price per unit which has given me the total number of units needed to be sold to make the given revenue figure, then i have deducted the fixed costs from the total sales revenue, and then multiplied the variable cost per unit by the amount units sold to achieve the sales revenue figure!!
oh dear im lost.
rob0 
Dont know if this helps but I use the acronyms quoted on here to try to remember Formulas. Breakeven in Revenue = Fixed Costs/ PV Ratio.
First of all calculate the PV Ratio by dividing the Contribution by the Sales Price.
Hope this helps
Julie0 
hi julie,
i have used your calc and it seems to give the answer of 0. so i presume ive broke even.
cheers
rob0
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