Concept explainers
Concept Introduction:
Breakeven point: Breakeven point is the level of output at which the sales is equal to the total cost and there is no profit or loss. Breakeven point in units is calculated with the help of following formula:
1.a. Breakeven point with no change in information:
To determine: The Breakeven point with no change in information
1.b. Breakeven point with decrease in sales price to $544 per student:
To determine: The Breakeven point with decrease in sales price
1.c. Breakeven point with decrease in variable cost to $340 per student:
To determine: The Breakeven point with decrease in variable cost
1.d. Breakeven point with decrease in fixed cost to $53040:
To determine: The Breakeven point with decrease in fixed cost
2. Comparison of impact of changes:
To show: The Comparison of impact of changes in the sales price, variable costs, fixed costs on the contribution margin per unit and the breakeven point in units
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Horngren's Accounting: The Managerial Chapters (12th Edition) (loose Leaf Version)
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