Calculations

• How to calculate total manufacturing overhead 


  Indirect labour + indirect material + other manufacturing overhead
• How to calculate total inventorial product cost 


  Direct labour + direct material + other manufacturing overhead
• How to calculate total prime cost 


  Direct material + direct labour
• How to calculate total conversion costs 


  Direct labour + other manufacturing overheads
• calculate contribution margin 


  Sales revenue - variable costs
• Where is the break even point 


  Where total sales and total costs are equal
• What is the margin of safety 


  the Difference between the normal level of sales and the break-even sales
• What is break even points in units 


  Fixed costs / contribution margin
• What is the contribution per unit 


  Sales price per unit - variable cost per unit
• What’s the break even point in $ 


  Break even point in units * selling price
• What is BEP in total sales

  Fixed expense / contribution margin ratio
• What is the variable expense ratio


  total variable expenses / total sales
• What is another way to calculate contribution margin ratio 


  Contribution margin per unit / selling price per unit
• How to determine level of sales to cover fixed costs and make profit 


  Fixed costs + target profit / contribution margin per unit
• How to calculate unit sales to attain target profit

  Target profit + fixed expenses / contribution margin unit
• Dollar sales to attain target profit 


  Target profit + fixed expenses / contribution margin ratio
• Contribution income statement 


  Revenue

  less: variable expenses

  CONTRIBUTION MARGIN

  less: fixed expenses

  Net Income