Managerial
Cost-volume-profit simulator
Move price, costs and volume and watch break-even and profit respond.
Tallis Outdoor sells one model of camping stove. Move price, costs and volume to see where the business breaks even and how sharply profit responds to volume.
- Contribution per unit
- 48.00
- CM ratio
- 40.00%
- Break-even units
- 5,000
- Rounded up to a whole unit
- Break-even revenue
- 600,000.00
- Units for target profit
- 6,250
- Margin of safety
- 2,000 units
- 28.57% of planned sales
- Operating profit
- 96,000.00
- Operating leverage
- 3.50×
- A 10% change in volume moves profit by about 35.0%
Planned sales of 7,000 units are 2,000 above break-even: sales could fall that far before the business makes a loss.
Profit if volume changes
| Volume change | Units | Operating profit | Bar showing relative size of profit or loss |
|---|---|---|---|
| −20% | 5,600 | 28,800.00 | |
| −10% | 6,300 | 62,400.00 | |
| Plan | 7,000 | 96,000.00 | |
| +10% | 7,700 | 129,600.00 | |
| +20% | 8,400 | 163,200.00 |
Bars show the size of profit (dark) or loss (red, figures in brackets) relative to the largest figure. Price, unit variable cost and fixed costs are held constant.
Learn it properly
- Cost-volume-profit analysis · Cost and Managerial Accounting
- Break-even and target profit · Cost and Managerial Accounting
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All companies and figures in the simulators are fictional.