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Don Hayward's Detroit Diesel 2 Stroke Engine Forum

Welcome to this forum, Feel free to ask for information or leave articles of help for other people interested in DD 2 Stroke's & GM 8.2L/GM 6.2L.. I Have Service Manuals for Inline71 - V71 - 53 Series - GM6.2l.. Also Parts Books 53-71-92-110.. Please use REFRESH after posts.. You don't have to remain ANON, if i post from an email etc.,I will use this to start with for your identity protection, then you can change if you wish.. Click on first post of subject to view all not last one, or switch Styles..

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Don Hayward's Detroit Diesel 2 Stroke Engine Forum
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How do fixed costs affect a company’s break-even point?

Costs that are not dependent on the level of production are crucial in establishing the break-even point, the volume of sales that a firm needs to achieve in order to make a specific sum of money in profit. Fixed cost means a business has to earn a certain revenue amount to offset these costs before getting into the profit making zone, the higher the fixed costs the greater the revenue necessary to cover these costs and the lower the fixed costs the less the revenue required to pay these costs.
For instance, monthly fixed costs could be worth $10,000 and the contribution per each unit $50 ($ selling price – $ variable cost per each unit); in this case the business needs to sell 200 units to cover the fixed costs.
It makes them define serious goals, and costs of production and selling the final products through an appropriate understanding of fixed costs. With less fixed expenses formula for instance obtaining favorable lease terms, outsourcing activities not central to the firm’s competence the break-even point moves down thus the possibility of increased profitability.

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