Assumptions of break-even analysis, Cost Accounting

Assumptions of Break-Even Analysis

1. The break-even chart is fundamentally a static analysis; commonly changes can merely be displayed by drawing a new chart or a series of charts

2. Relevant range is given to explain fixed and variable costs in relation to an exact period and designated range of production level

3. All costs go down into either variable or fixed cost classification

4. Unit variable costs stay the similarity and there is a direct relationship between volume and costs

5. Volume is assumed to be the merely important factor affecting cost nature

6. Unit sales price and other market situations are assumed to stayed unchanged

7. Net fixed costs stay constant over the relevant range considered

8. Inventory changes are so unimportant such they have no impact on the analysis

9. The technology level does not change.

Posted Date: 2/7/2013 12:37:17 AM | Location : United States







Related Discussions:- Assumptions of break-even analysis, Assignment Help, Ask Question on Assumptions of break-even analysis, Get Answer, Expert's Help, Assumptions of break-even analysis Discussions

Write discussion on Assumptions of break-even analysis
Your posts are moderated
Related Questions
On July 1, 2008, Falk Company signed a contract to lease space in a building for 15 years. The lease contract calls for annual (prepaid) rental payments of $100,000 on each July 1

Make-or buy and relevant costs - The assembly division of Davenport, Inc., is bidding on an order of 50,000 smart phones. The division is eager to get this order because it has a s

Accounts Payable or sundry creditors are generally unsecured debts owed through the firm. These are also considered to as payables on open accounts. They may not be evidenced throu

Overhead Absorption Absorption of overheads refers to the sharing out of overhead costs to the some cost centers such used the overheads. This is utilized when the overheads c

the following activities relating to indirect production costs: Activity Activity Costs Cost Drivers Machine Setup $180,000 1,500 setup hours Materials Handling $50,000 12,500 poun

Find Out the Memorandum Reconciliation Account The givens are the final accounts of a company for the year ending on date 31st December 1999. Manufacturing Trading Loss and Pr

product mix decisions with capacity constraint

The Cutting Department of the Rock Island Custom Cabinetry Corporation (a process costing production) had no work in process at the beginning of the period, 12,000 units were compl

A local government authority owns and operates a leisure centre with numerous sporting facilities, residential accommodation, a cafeteria and a sports shop. The summer season lasts

British Columbia Lumber has a Raw Lumber Division and a Finished Lumber Division. TheĀ  variable costs are: 1.Raw Lumber Division: Rs. 100 per 100 board-feet of raw lumber 2.F