Demerits of break even point, Cost Accounting

DEMERITS OF BREAK EVEN POINT

1. It pays no attention to considerations like effect of government policy changes, changes in the marketing environment etc

2. Fixed cost, entire costs cannot be represented as straight lines

3. It is hard to handle advertisement expenditure

4. Semi-variable costs are ignored

5. It ignores economies of scale in production

6. Fixed costs also may alter in the long run

7. Volume of production and volume of sales are for all the time not identical

8. Selling price may or may not be the identical

Posted Date: 10/15/2012 7:09:21 AM | Location : United States







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

Write discussion on Demerits of break even point
Your posts are moderated
Related Questions
Prepare Cash Budget of a Company The given information concerned to the proposed budget for a company for the months ending on 31 December 1996. Additional Information

This time of year we all here about football. For me it is the bad news of how poorly the Buffalo Bills are performing. Hopefully your favorite team is doing well. One thing we

Beaver Company (a multi-product firm) produces 5,000 units of Product X each year. Each unit of Product X sells for $8 and has a contribution margin of $5. If Product X is disconti

XYZ Pvt Ltd is a private company incorporated in Australia, and manufactures handbags. The opening balance of XYZ Pvt Ltd's franking account on 1 July 2010 was $nil. During the 201

Your company completed the East Side subdivision. The costs are shown in Figure 11-4. The site concrete labor and outside lighting were done by subcontractors. The grading and exca

Example of Contract Account  A company has been awarded a contract to build a house.  It is a contract Number 45 for the company and the contract price is shs.2.65 millio

Group Bonus Plan There are specific operations or jobs that require to be done collectively via a group of workers, as an example of, continuous production work flows in asse

Assume B, G and T are in real terms (and in billions of dollars). B t-1  = 1000      G t = 220           T t = 200            i t   = .15     π t   = . 10 a) Calculate th

on june 2005 20 units of the product in stock the following is extracted from the companys books direct material-200 per unit,direct labour 150 per unit, variable production overhe

A manufacturing company wants to package its product in a rectangular box with a square base and a volume of 32 cubic inches. The cost of the material used for the top is $.05 squa