BEP Calculation Possible with Multiple Products?

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Break-even Analysis > Best Practices > BEP Calculation Possible with Multiple Products?

BEP Calculation Possible with Multiple Products?
THEODORE BABU, Student (MBA), South Africa, Member
If you have multiple products with hardly any variable cost, would BEP calculation still be an option? I have 40 lines and do not know how many products will sell. I only have a fixed expense being the space hired monthly and electricity usage. Would electricity be a variable cost since the usage depends on how long the machine is running. Do I then allocate this cost over all the products equally. Please advise. (...) Read more? Sign up for free

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  Electricity Cost Allocation
Day Pierre DESAULT, Consultant , France, Member
  If its cost is 15%-20% of your total turn-over, you might allocate 17.5% of this sum over all the productions equally.
You might also allocate its real cost plus 5%-10% (inflation, energy cost raising etc.. for anticiping.
Analyse the two methods and use your good sense!

  Cost Types in Break Even Analysis
ALBAN ONWULIRI
  Break Even Analysis is a Management tool in decision making and helps management to classify costs as FIXED or VARIABLE:
- Fixed costs are those cost that are not related to the volume of production, whereas
- Variable costs are those that change as the volume of out put in a production plant changes.
The cost of your electricity bill will in the case of your business be a variable cost. The longer hours you work to produce the product, the higher the electricity cost.
Remember, always that variable costs are those cost that vary directly with the level of output.
To be guided further, there is often a distinction between DIRECT VARIABLE COST and INDIRECT VARIABLE COST:
- Direct variable cost can be attributed to the production of a particular product line or service and allocated to a particular cost center (e.g., raw materials and direct wages, whereas
- Indirect variable costs cannot be directly attributed to a production line or service, but vary with output (e.g., depreciation.

   
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Break-even Analysis
Summary
Forum
Cost of Idle HQ Staff Included in Break-even Point Calculation?
🔥Break-even Point as Maximum Revenue
How to Account for Interest in Break-even Point Calculation?
Best Practices
🥇Time after Break-even Point?
🥈How to Calculate BEP Without Price Given?
🥉Break Even Point formula for a service industry
Break Even Analysis and Cost Benefit Analysis
Breakeven Point Calculation
Further Limitations of Break Even Analysis
Not enough revenues...?
Time for break even..
Break-even Point Example
Break Even Point Calculation of a Bank
Breakeven Formula for Services
Contribution in Break-even Point
Measuring Improvement in Break Even Point
BEP Calculation Possible with Multiple Products?
How to Deal with Owners Withdrawals in Break-even Analysis?
BEP Useful for New / Start-up Businesses
Could There Be 2 or even more Break Even Points?
Break-even Point Analysis when Material Prices Fluctuate


Break-even Analysis
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