Break-Even Analysis

Enter your numbers in the TFC, VCU, and SPU cells.

Remember that VCU and SPU are per unit.
25000

20000

15000

TFC
TVC
TC
Sale
s
Profit

10000

5000

0
0

400

800

1200

1600

2000

2400

2800

3200

3600

4000

-5000
Break-Even Point (units) = 2,000
Total Fixed Costs
Variable Cost per Unit
Sales Price per Unit

TFC =
VCU =
SPU =

Break-Even Point ($'s) = $10,000

$3,000
$3.50
$5.00

Formulas:
BEP (units) = TFC/(SPU-VCU)
BEP ($'s) = BEP (units) * SPU

Copyright, 2010, JaxWorks, All Rights Reserved.

Break-Even Analysis
Time Unit price Unit V.C
Month
45
35

Fixed Cost
2000

Sale

25000
Units
0
50
100
150
200
250
300
350
400
450
500

Sales V.Cost Contribution F.Cost Total CostNet Income

0
0
0
2000
2000 (2000.00)
2250
1750
500
2000
3750 (1500.00)
4500
3500
1000
2000
5500 (1000.00)
6750
5250
1500
2000
7250 (500.00)
9000
7000
2000
2000
9000
0.00
11250
8750
2500
2000
10750
500.00
13500 10500
3000
2000
12500 1000.00
15750 12250
3500
2000
14250 1500.00
18000 14000
4000
2000
16000 2000.00
20250 15750
4500
2000
17750 2500.00
22500 17500
5000
2000
19500 3000.00

20000

15000

10000

5000

0
0

BEP X

BEP Y

200

Label

Break
even
9000 units=200

0= units* (Sales- Variable Cost) - Fixed Cost

Fixed cost = Units*(Sales-Variable Cost)
Units= Fixed cost/(Sales-Variable Cost)

BEP= F.C /(1-(V.C/SALES)

Sales

25000

F.Cost

Total Cost

Break even units=200

20000

15000

10000

9000

5000

0
0

100

200

300

400

500

600

Wavendon Plumbing: 6-Month Financial Projection

Number of Months

CALCULATE YOUR GROSS PROFIT

Projected Sales

75,000

Less Direct Costs

Purchases (material costs)

32,500

Labour Costs

20,000

Gross Profit
Gross Profit Margin

22,500
30%

CALCULATE YOUR OVERHEADS

Indirect Costs
Business Salaries (including your own drawin

6,000

Rent

2,000

Rates

500

Light/Heating

500

Telephone/Postage

500

Insurance

500

Repairs

2,000

Advertising

1,500

Bank Interest/Hire Purchase

1,500

Other (eg depreciation of fixed assets)

1,500

Overheads

16,500

Break-Even Sales

55,000

Monthly Break-Even Sales

9,167

Profit (for 6 months)

6,000

Break-Even Analysis
2007

2008

2009

2010

2,010,000.00

2,060,000.00

2,121,800.00

2,391,800.00

Materials

320,000.00

329,600.00

339,488.00

389,088.00

Labor

500,000.00

515,000.00

530,450.00

545,450.00

Variable overhead

125,000.00

128,750.00

132,612.50

186,362.50

Sales
Less Variable Expenses

Other
Contribution Margin
Contribution Margin Ratio

0.00
1,065,000
52.99%

0.00
1,086,650
52.75%

0.00
1,119,250
52.75%

0.00
1,270,900
53.14%

Fixed Expenses
Salaries and wages

190,000

190,000

190,000

190,000

Employee benefits

50,000

51,500

53,045

54,545

Payroll taxes

30,000

30,900

31,827

32,727

Rent

5,000

5,150

5,305

5,455

Utilities

3,000

3,090

3,183

3,273

Repairs and maintenance

1,000

1,030

1,061

1,061

Insurance

1,000

1,030

1,061

1,061

Travel

2,133

2,197

2,263

2,263

11,000

11,330

11,670

12,670

Postage

4,000

4,120

4,244

4,244

Office supplies

6,000

6,180

6,365

6,365

Advertising

1,000

1,030

1,061

1,061

Marketing/promotion

3,000

3,090

3,183

3,183

Professional fees

1,000

1,030

1,061

1,061

Training and development

1,000

1,030

1,061

1,061

Bank charges

1,000

1,030

1,061

1,061

Depreciation

1,000

1,030

1,061

1,061

Interest Expense

6,000

6,000

6,000

6,000

317,133

320,767

324,510

328,150

Telephone

Other
Total Fixed Expenses
Total Fixed Expenses Ratio
Break-Even Sales
Break-Even %
Operating Profit

Sales
Less: Variable Cost

Contribution
Less: Fixed cost
Net Operating Profit

15.78%
598,533
29.78%
747,867

15.57%
608,089
29.52%
765,883

15.29%
615,185
28.99%
794,740

13.72%
617,570
25.82%
942,750

2,010,000.00
945,000.00

2,060,000.00 2,121,800.00
973,350.00 1,002,550.50

1,065,000.00
317,133.00

1,086,650.00 1,119,249.50
###
320,766.99
324,510.00 328,150.00

747,867.00

765,883.01

###
###

794,739.50 942,749.50

Break even sales

598532.7042254

Time
Month

Unit price
45

Month

Sales
300,000.00
598,532.70
900,000.00
###
###
###

1
2
3
4
5
6
7
8
9

608089.08056872 615184.8335545 617569.81514

Unit V.C
35

Fixed Cost
2000

V.Cost
141,044.78
281,399.70
423,134.33
564,179.10
705,223.88
846,268.66

Contribution
158,955.22
317,133.00
476,865.67
635,820.90
794,776.12
953,731.34

F.Cost
###
###
###
###
###
###

###
945,000.00
### 1,128,358.21
### 1,269,402.99

###
###
###

###
###
###

598,532.70 BEP=598532.7

Break Even

Break Even Chart

Sales

Fixed Cost

Total Cost

BEP=598532.7

3,000,000.00
2,500,000.00
2,000,000.00
1,500,000.00
1,000,000.00
598,532.70

500,000.00
0.00
0

Total Cost
458,177.78
598,532.70
740,267.33
881,312.10
###
###

Net Income
###
-0.00
159,732.67
318,687.90
477,643.12
636,598.34

### 747,867.00
### 954,508.79
###
###

Chart
BEP=598532.7

10