Should be easy for you to switch between units, currency, %.
Contribution analysis effectively how much each unit contributes to fixed costs. It’s basically stripping away variable costs and looking at it that way (before stripping fixed costs). It’s done on a unit basis.
- Unit Contribution = Unit Price - Unit Variable Cost $28.75 = $50.00 - $21.25
- Breakeven Volume on Fixed Costs = Fixed Costs / Unit Contribution 1,043 units = $30,000 / $28.7
- Break-Even Market Share = Breakeven Volume / Total Market Size 7% market share = 1,043 units / 14,300 units
- Total Contribution to Fixed Costs & Profit = Volume Sold x Unit Contribution $48,875 = 1,700 units x $28.75
- Net Profit = Total Contribution to Fixed Costs & Profit - Fixed Costs $18,875 = $48,875 - $30,000
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