Breakeven Analysis

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Cost Description Variable Costs Cost of Goods Sold Inventory Raw Materials Direct a!or "Includes #ayroll $a%es& Fixed Costs Salaries "includes payroll ta%es& Supplies Repairs ) maintenance *dvertisin+ Car, delivery and travel *ccountin+ and le+al Rent $elephone -tilities Insurance $a%es "Real estate, etc.& Interest Depreciation .ther "specify& .ther "specify& Miscellaneous e%penses #rincipal portion of de!t payment .wner/s draw Total Fixed Costs Total Variable Costs Fixed Costs ($) Variable Costs (%) 0.0% 0.0% 0.0% 0.0%

otes on !reparation You may want to print this information to use as reference later. To delete these instructions, click the border of this text box and then press the DELETE key. -sin+ fi+ures from your #rofit and oss #ro0ection, enter e%pected annual fi%ed and varia!le costs.

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1i%ed costs are those that remain the same re+ardless of your sales volume. $hey are e%pressed in dollars. Rent, insurance and real estate ta%es, for e%ample, are usually fi%ed. 2aria!le costs are those which chan+e as your volume of !usiness chan+es. $hey are e%pressed as a percent of sales. Inventory, raw materials and direct production la!or, for e%ample, are usually varia!le costs. -nder the varia!le e%penses column, use whole num!ers as a percenta+e, not decimal num!ers. 1or e%ample, use 34%, rather than .34%. 1or your !usiness, each cate+ory of e%pense may either !e fi%ed or varia!le, !ut not !oth.

Breakeven Sales level =

S"##estions

You may want to print this information to use as reference later. To delete these instructions, click the border of this text box and then press the DELETE key. $he cate+ories of e%pense shown a!ove are 0ust su++estions. Chan+e the la!els to reflect your own accountin+ systems and type of !usiness. 5rea6even is a 7!i+ picture7 6ind of tool8 we recommend that you com!ine e%pense cate+ories to stay within the 99 lines that this template allows. .ne of the !est uses of !rea6even analysis is to play with various scenarios. 1or instance, if you add another person to the payroll, how many e%tra sales dollars will !e needed to recover the e%tra salary e%pense: If you !orrow, how much will !e needed to cover the increased principal and interest payments: Many owners, especially retailers, li6e to calculate a daily !rea6down. $his +ives everyone a tar+et to shoot at for the day.