《现代财务管理》 (美)麦克圭根(McGuigan,J.R) AISE_Instructors_Manual cfm10e_aiseIM14Arev.docVIP

Appendix 14A Breakeven Analysis PAGEXXX PAGE 224 APPENDIX 14A BREAKEVEN ANALYSIS ANSWERS TO QUESTIONS: 1. A linear breakeven chart is constructed as follows: a. The total revenue (TR) function is found by drawing a line through the origin with a slope of P$/unit. b. The total cost (TC) function is found by drawing a line that intersects the vertical axis at F$ and has a slope of V$/unit. c. Determine the point where the TR and TC lines intersect and then construct a perpendicular line to the horizontal axis at this point--the resulting output level is the breakeven volume (Qb). 2. Limitations of linear breakeven analysis: a. Selling price and variable cost per unit may not be constant over the output range under consideration, i.e., the total revenue and total cost functions may not be linear as assumed in the model. b. Classification of costs into fixed and variable categories may be difficult since the distinction between the two types of costs depends on both the time period under consideration and the output range under consideration. c. When dealing with multiple products and a changing product mix over time, problems can arise in allocating fixed costs among the various products. d. The parameters of the breakeven model (i.e., P, V, and F) are often subject to uncertainty. Inaccurate estimates of these parameter values may impair the usefulness of the model. e. Matching operating costs with revenues can be difficult when the benefits received from expenditures (such as research and development) extend beyond the planning horizon of the breakeven model. 3. a. A reduction in price per unit (P) reduces the contribution margin per unit (P - V) and hence increases the breakeven output level (Qb). b. An increase in direct labor costs increases variable cost per unit (V), reduces the contribution margin per unit (P - V), and hence increases the breakeven output level (Qb). c. The installation of new ventilating equipment increase