00:01
In this video, we're going to solve for the break -even sales in dollars of alpha division.
00:10
Now, i have here taken the data figures for alpha division.
00:15
We have sales, variable costs, and traceable fixed cost, or traceable fixed expenses.
00:23
Now, let us solve for our break -even sales, and the formula for that, break -even point in sales is equal.
00:32
Equal to your fixed cost divided by contribution margin ratio.
00:41
We're not computing here for the break -even point in units, but the break -even point in sales dollars.
00:48
That's why we're using cmr, contribution margin ratio.
00:55
Now we have a fixed cost, a traceable fixed cost of 83 ,160.
01:02
Now, the traceable fixed costs or fixed expenses are considered while we taking segment analyses because these are identified specifically to such division of company only.
01:19
Hence, we need to consider only such fixed cost for segment break -even analysis of sales.
01:25
So you disregard the common fixed cost because the common fixed cost is attributable attributable to both, alpha and beta division.
01:37
So we only take and consider those that is specific to alpha division, which is the traceable fixed cost of 83 ,160.
01:47
Now for cmr, it is not given, so we need to solve for it...