Home For AAT student members AQ 2016 Advanced Diploma in Accounting General discussion - Advanced level
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Breakeven Analysis

I have tried to compute the breakeven sales by taking the fixed costs/contribution margin

The gross profit is the sales - variable costs. I computed the Contribution margin by taking the gross profit/sales x 100

I have attached my sample data as it is giving me an incorrect breakeven sales. However If I use Goal Seek, the Sales is 436000, which we then show a zero Net profit

It would be appreciated if someone could check my formula and advise

Comments

  • FlupsieFlupsie Registered Posts: 4
    resolved my problem in computing the estimated Net Profit using data tables.

    My Breakeven was 100% but I was getting an incorrect answer when computing forecasted Net Profit based on increased sales data when using a data table.

    My Contribution margin was 27.1111% (GP %)

    To resolve the problem regarding the incorrect forecasted net profit , I set my variable costs to be Sales * (1-0.271111) and now I get correct forecasted net profit
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