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Break-Even Analysis

[Company Name]

[Proposed Product]

[Date]

For the Period: Jan 1, 2009 - Jun 30, 2010


Selling Price (P): $
12.00
Break-Even Units (X):
100 units
Break-Even Sales (S): $
1,188.12
[42]

Fixed Costs
Advertising
Accounting, Legal
Depreciation
Interest Expense
Insurance
Manufacturing
Payroll
Rent
Supplies
Taxes (real estate, etc.)
Utilities
Other (specify)

Total Fixed Costs (TFC)

1,000.00

1,000.00

Variable Costs
Variables Costs based on Dollar Amount per Unit
Cost of Goods Sold
Direct Labor
Overhead
Other (specify)

Sum: $
Variables Costs based on Percentage
Commissions
Other (specify)
Sum:

Total Variable Cost per Unit (V)


Contribution Margin per unit (CM) = P - V
Contribution Margin Ratio (CMR) = 1 - V / P = CM / P

Break-Even Point
Break-Even Units (X)
Break-Even Sales (S)

1.00 per unit


per unit
per unit
per unit
1.00
7.50% per unit
per unit
7.50%

1.90

10.10
84.2%

X = TFC / (P - V)
S = X * P = TFC / CMR

100 units
1,188.12

Targeted Net Income


Targeted Net Income Before Taxes (NIBT)

Units required to reach targeted NIBT, X = (TFC + NIBT) / (P-V)


Sales required to reach targeted NIBT, S = (TFC + NIBT) / CMR
Rate of return on sales before taxes = NIBT / S

100 units
1,188.12
0.0%

Tax Rate (T)


Net Income After Taxes (NIAT) = (1-T)*NIBT
Rate of return on sales after taxes = NIAT / S

25%
0.0%

Chart
Units (X)

$3,0000
10
$2,500
20
30
$2,000
40
50
$1,500
60
70
$1,000
80
90
100
$500
110
120
$130 0
140
$(500)
150
160
$(1,000)
170
180
$(1,500)
190
200

Fixed Cost
1,000.00
1,000.00
Total
Cost
1,000.00
Total
Revenue
1,000.00
1,000.00
Profit
(Loss)
1,000.00
1,000.00
1,000.00
1,000.00
1,000.00
1,000.00
1,000.00
1,000.00
1,000.00
50
1,000.00
1,000.00
1,000.00
1,000.00
1,000.00
1,000.00
1,000.00

Break-Even Point
Total Cost
Total Revenue
1,000.00
1,019.00
1,038.00
1,057.00
1,076.00
1,095.00
1,114.00
BEP
1,133.00
1,152.00
1,171.00
1,190.00
1,209.00
1,228.00
1001,247.00
1,266.00
1,285.00
1,304.00
1,323.00
1,342.00
1,361.00
Units (X)
1,380.00

150

Profit (Loss)

(1,000.00)
120.00
(899.00)
240.00 Total Revenue
(798.00)
360.00
(697.00)
480.00
(596.00)
600.00
(495.00)
720.00
(394.00)
Total Cost
840.00
(293.00)
960.00 Profit (Loss)
(192.00)
1,080.00
(91.00)
1,200.00
10.00
1,320.00
111.00
1,440.00
212.00
1,560.00
313.00
200
250
1,680.00
414.00
1,800.00
515.00
1,920.00
616.00
2,040.00
717.00
2,160.00
818.00
2,280.00
919.00
2,400.00
1,020.00

y Name]
2009 Vertex42 LLC
HELP
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Break-Even Price

[Company Name]

[Proposed Product]

[Date]

For the Period: Jan 1, 2009 - Jun 30, 2010


Number of Units (X):
100
Break-Even Price (P): $
13,913.84 per unit
Break-Even Sales (S): $ 1,391,383.78
[42]

Fixed Costs
Advertising
Accounting, Legal
Depreciation
Interest Expense
Insurance
Manufacturing
Payroll
Rent
Supplies
Taxes (real estate, etc.)
Utilities
Other (specify)

Total Fixed Costs (TFC)

$
$
$
$

1,000.00
300.00
30,000.00
50,000.00

30.00

81,330.00

Variable Costs
Variables Costs based on Dollar Amount per Unit
Cost of Goods Sold
Direct Labor
Overhead
Other (specify)
Sum (Vd):

$
$
$
$
$

Variables Costs based on Percentage


Commissions
Other (specify)

V = Vd + (Vp*P)

Contribution Margin per unit (CM) = P - V


Contribution Margin Ratio (CMR) = 1 - V / P = CM / P

Break-Even Point
Break-Even Price (P)
Break-Even Sales (S)

per unit
per unit
per unit
per unit

7.50% per unit


per unit
7.50%

Sum (Vp):

Total Variable Cost per Unit (V)

1.00
10,000.00
2,000.00
56.00
12,057.00

P = (1/(1-Vp))*(Vd+(TFC/X))
S = X * P = TFC / CMR

$
$

13,100.54
813.30
5.8%

$
13,913.84
$ 1,391,383.78

Targeted Net Income


Targeted Net Income Before Taxes (NIBT)

Sales Price (P) required to reach targeted NIBT


Sales required to reach targeted NIBT, S = X * P
Rate of return on sales before taxes = NIBT / S

$
$

Tax Rate (T)

13,913.84
1,391,383.78
0.0%
25%

Net Income After Taxes (NIAT) = (1-T)*NIBT


Rate of return on sales after taxes = NIAT / S

Chart
Price (P)

$3,500,000
0
$$3,000,000
2,087.08
$3,478.46
$$2,500,000
4,869.84
$6,261.23
$$2,000,000
7,652.61
$9,043.99
$1,500,000
########
########
$1,000,000
########
$500,000
########
########
$########
$########
$(500,000)
########
$(1,000,000)
########
########
$(1,500,000)
########
########
$(2,000,000)
########
########

Fixed Cost
81,330.00
81,330.00
Total
Cost

Break-Even Price
Total Cost
Total Revenue

0.0%

Profit (Loss)

1,391,383.78
(1,391,383.78)
1,391,383.78
208,707.57
(1,182,676.22)
81,330.00
1,391,383.78
347,845.95
(1,043,537.84)
Total Revenue
81,330.00
1,391,383.78
486,984.32
(904,399.46)
Total
Revenue
81,330.00
1,391,383.78
626,122.70
(765,261.08)
Profit
(Loss)
81,330.00
1,391,383.78
765,261.08
(626,122.70)
BEP
81,330.00
1,391,383.78
904,399.46
(486,984.32)
81,330.00
1,391,383.78
1,043,537.84
(347,845.95)
81,330.00
1,391,383.78
1,182,676.22
(208,707.57)
81,330.00
1,391,383.78
1,321,814.59
(69,569.19)
Profit (Loss)
81,330.00
1,391,383.78
1,460,952.97
69,569.19
81,330.00
1,391,383.78
1,600,091.35
208,707.57
81,330.00
1,391,383.78
1,739,229.73
347,845.95
$5,000.00 $10,000.00 $15,000.00 $20,000.00 $25,000.00 $30,000.00
81,330.00
1,391,383.78
1,878,368.11
486,984.32
81,330.00
1,391,383.78
2,017,506.49
626,122.70
81,330.00
1,391,383.78
2,156,644.86
765,261.08
81,330.00
1,391,383.78
2,295,783.24
904,399.46
81,330.00
1,391,383.78
2,434,921.62
1,043,537.84
81,330.00
1,391,383.78
2,574,060.00
1,182,676.22
81,330.00
1,391,383.78
2,713,198.38
1,321,814.59
Sales Price
81,330.00
1,391,383.78
2,852,336.76
1,460,952.97

y Name]
2009 Vertex42 LLC
HELP
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Payback Period
[Proposed Product]

Selling Price (P): Rp


Number of Units Sold (x):

250,000
100

Payback Period (t):


Break-Even Sales: Rp

24.00
600,000,000

Fixed Costs
Start-up / Development Costs
Development
Labor
Other start-up costs
Total Startup Costs (SC):
Recurring Costs specified as $ per Month
Advertising
Web Host Fees
Other recurring costs
Recurring Costs (RC):

$
$
$
$

5,000,000.00
5,000,000.00
Total Recurring Costs:

Total Fixed Costs (TFC) = SC + RC * t


Variable Costs
Variables Costs based on Dollar Amount per Unit
Cost of Goods Sold
$
Direct Labor
$
Overhead
$
Other (specify)
$
Sum: $
Variables Costs based on Percentage
Commissions
Other (specify)
Sum:

Total Variable Cost per Unit (V)


Contribution Margin per unit (CM) = P - V
Contribution Margin Ratio (CMR) = 1 - V / P = CM / P

Total Variable Cost (TVC) = V * x * t

250,000.00
2,000,000.00
20,000.00
2,270,000.00
0.00%
0.00%
0.00%

[Company Name]
[Date]

per month
months
[42]

Rp
Rp

500,000
2,000,000

Rp

2,500,000

per month
$

120,000,000.00

122,500,000.00

per unit
per unit
per unit
per unit

per unit
per unit

$
$

2,270,000.00
(2,020,000.00)
-808.0%

5,448,000,000.00

2009 Vertex42 LLC


HELP
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