Break Even Point
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
15 March 2010
Dear Sir,
We are a Manufacturer & Jobworker of Auto/Engine Parts.
Pl. give us suitable format for BEP.
We are a Manufacturer & Jobworker of Auto/Engine Parts.
Pl. give us suitable format for BEP.
15 March 2010
The break-even point for a product is the point where total revenue received equals the total costs associated with the sale of the product (TR = TC).
Break even analysis can also be used to analyze the potential profitability of an expenditure in a sales-based business.
Break even point (for output) = fixed cost / contribution per unit
contribution (p.u) = selling price (p.u) - variable cost (p.u)
You should calculate direct variable cost associated with job work of one unit; deduct it from the amount chargeable for single unit. This is your contribution per unit. Now divide total fixed cost with contribution per unit and the resultant will be your BEP in terms of units. Job work for any number of units in excess of this BEP will generate profits for you.
Break even analysis can also be used to analyze the potential profitability of an expenditure in a sales-based business.
Break even point (for output) = fixed cost / contribution per unit
contribution (p.u) = selling price (p.u) - variable cost (p.u)
You should calculate direct variable cost associated with job work of one unit; deduct it from the amount chargeable for single unit. This is your contribution per unit. Now divide total fixed cost with contribution per unit and the resultant will be your BEP in terms of units. Job work for any number of units in excess of this BEP will generate profits for you.
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Tax Audit Applicability – Newly Formed Partnership Firm with Profit Below 6%/8%
- TDS CREDIT MISMATCHING
- Buy back of shares u/s69
- Sec 44ada applicable only or both
- RELATED TO TRIBUNAL APPEAL
- Need Professional Opinion - AY 2012-13 Old Demand & AY 2026-27 Refund Adjustment
- GST Rate for Catering Services
- Taxability of Partnership firm for FY 2025-26
- IS AUDIT MANDATORY IF COMMISSION INCOME IS MORE THAN 50 LAKH
- EMI ISSUE IN HOUSING LOAN OLD REGIME
- CALCULATION OF DEFFERED TAX - OP BL IS DTL & CURRET IT DTA
- LLP audit under companies act
- Experienced CA recommendation from Kolkata for FNO return filing
- Interest Reporting in Form 168
- Sales of goods of amount Rs77 lakhs to a party
- Tax Demand of ₹4,650 for AY 2026-27
- Concept of Vendor and customner reconciliation
- Mistake in e-invoice identified after 24 hours
- EXPORT PAYMENT
- NRI ITR2 account in 2025-26.
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
Subscribe to Pro
Join an elite circle of professionals
CAclubindia
