Least-Squares Regression Q Least-squares regression n is usually covered in advanced cost accounting courses。 n is commonly used with computer software because of the large number of calculations required n The objective of the cost analysis remains the same: determination of total fixed cost and the variable unit cost Task Team of FUndaMientalactoUntING Business Sehool. Sun Yatsen niversity 16
16 Least-Squares Regression ⧫Least-squares regression is usually covered in advanced cost accounting courses. is commonly used with computer software because of the large number of calculations required. The objective of the cost analysis remains the same: determination of total fixed cost and the variable unit cost
Break-Even Analysis ◆ The break-even point is the unique sales level at which a = company neither earns 5 Sales a profit nor incurs a loss Total costs oo Volume in units Task Team of FUndaMientalactoUntING Business Sehool. Sun Yatsen niversity 17
17 Break-Even Analysis ⧫ The break-even point is the unique sales level at which a company neither earns a profit nor incurs a loss. Sales Total costs Volume in Units Costs and Revenue in Dollars
Break-Even Analysis Q The break-even point may be expressed in units or in dollars of sales Fixed Costs Break-even point in units Contribution margin per unit Unit sales price less unit variable cost Task Team of FUndaMientalactoUntING Business Sehool. Sun Yatsen niversity 18
18 Break-Even Analysis ⧫The break-even point may be expressed in units or in dollars of sales. Break-even point in units = Contribution margin per unit Unit sales price less unit variable cost Fixed Costs
Break-Even Analysis A The break-even formula may also be expressed in sales dollars Fixed Costs Break-even point in dollars Contribution margin ratio Unit sales price Unit variable cost Task Team of FUndaMientalactoUntING Business Sehool. Sun Yatsen niversity 19
19 Break-Even Analysis ⧫The break-even formula may also be expressed in sales dollars. Unit sales price Unit variable cost Break-even point in dollars = Contribution margin ratio Fixed Costs
Computing Income from Expected Sales QWhat is the income given a predicted level of sales Pre-tax Income Sales - [Fixed costs Variable costs] or Pre-tax Income Sales-Fixed costs- Variable costs Task Team of FUndaMientalactoUntING Business Sehool. Sun Yatsen niversity
20 Computing Income from Expected Sales ⧫What is the income given a predicted level of sales? Pre-tax Income = Sales – [Fixed costs + Variable costs] Pre-tax Income = Sales –Fixed costs - Variable costs or