Reference no: EM133038305

1: Explain what the break- even point is and why a business would use break -even analysis?

2: If cost are higher than the revenue, is the business making a profit loss. Explain if true or false?

3: What is contribution and how is it calculated ?

4: If the average variable cost per unit is $7, and the average selling price per unit is $19 , what is the contribution per unit ?

5: What is the break-even formula?

6: If the average variable cost per unit is 3, the average selling price is $15 and fixed cost are $25,000 , what is the break-even output in units and the break-even sales Revenue?

7: Explain the margin of safety, how it is calculated and what it means to a business?

8: Compare at least one strength and one limitation of using break-even analysis