Why is it necessary to calculate the Locational break even analysis?Locational break even analysis gives you an idea as to when your organization is going tostart making progress.Locational break even analysis will also give you can general idea as to whether or not your business will give pr...
Locational break even analysis happens to be an important management tool, it shows the point
where the business has met all its expenses and has now began to show profit for the
organization. Locational break even analysis is done by breaking down costs as variable cost and
fixed cost and comparing these costs to a certain level of sales. Where variable cost is the
happens to be directly related to the production process or those necessary in providing the
services, and fixed cost is where the cost remains the same and is not affected by the change in
the output.
Why is it necessary to calculate the Locational break even analysis?
Locational break even analysis gives you an idea as to when your organization is going to
start making progress.
Locational break even analysis will also give you can general idea as to whether or not
your business will give profit.
Locational break even analysis will also give you a strategy to work with, which will give
the desired final output.
Locational break even analysis will you decide what your business startup capital is
going to be, how many employees you will need and many such factors.
Break even is a point where your company neither loses money nor gains money, before
the company moves ahead it has to definitely reach the breakeven point.
This knowledge about the Locational break even analysis affects the decision about
which product to manufacture, the price to sell the products for, and the cost structure. Only
when you have a good knowledge about all these factors you can make a well calculated and
logical decision for your company.
You your organization do not meet the breakeven point then you can do the following to ensure
that the loss and profit are a bit balanced.
You can reduce the fixed costs that the company spends
You can reduce the variable cost
Increase the selling price of the product.
Questions:
Why is it important to know about Location break even analysis?
What does Locational break even analysis mean?
Center of Gravity Method
It is a method to determine the lo cation of a facility that
about:blank 1/2
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller ujjwalmishra976. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $8.49. You're not tied to anything after your purchase.
