Bep

Hi All,

As we all know BEP is a state where my expenses are nullified by my revenue.

Contribution = Sales-V.C

BEP in INR = FC/PV ratio

BEP in Units = FC/ contribution per unit

Now, Sales = 100000 INR, VC is 60000 INR , FC is 30000 INR.

So as per formulae above we have,

Contribution @ 40000 INR

PV @ 0.4

Now BEP in INR is 75000(30000/0.4)

Formula states that @ 75000 i will be nullify my expenses.

Actually my expenses is 90000(60000+30000).

Why am I getting this difference?

Kindly correct if I'm wrong.

Thanks in advance.