, but then later states that the use of CBA in such
With multiple product lines, the retailer can estimate a weighted average markup percentage that will improve the precision of the breakeven analysis
. This is done by multiplying the markup percentage for one product line by the estimated proportion of sales that product line is expected to generate.
For Bob's Bicycles, our example company, we've chosen to create a detailed Contribution Margin Income Statement that will provide the information necessary to perform both an overall breakeven analysis
and a detailed variance analysis (see Figure 1).
In order to perform effective breakeven analysis
using the formulas illustrated above, you need to be able to identify all of your costs and assign them to fixed or variable "buckets." This task is often more difficult than it would seem but going through the process results in a thorough understanding of your business' cost structure.
A CD-ROM that comes with the book includes balance sheet information; templates for budgeting, ROI analysis, breakeven analysis
, vendor selection and evaluation, and request for proposal (RFP); and report writing exercises.
The above reasoning is standard in financial breakeven analysis
, and we conclude that a financial breakeven method is better suited to depict the label-artist relation than accounting breakeven.
Tata offers 63 SimBLs modules that cover business subjects from Accounting-Contribution Margin and Breakeven Analysis
, to Fundamentals of Financial Statements.