What you’ll learn4 learning objectivesChoose one objective for a focused lesson, or study the complete topic.5.5.1Contribution• Distinguish total contribution and contribution per unit• Contribution supports break-even, pricing, and output decisionsSyllabus objective5.5.2Break-even chart and analysis• Construct and interpret break-even quantity or point, profit or loss, margin of safety, target profit output, target profit, and target price• Break-even analysis uses fixed costs, variable costs, total costs, revenue, and contributionSyllabus objective5.5.3Effects of price and cost changes• Analyse effects of price or cost changes on break-even quantity, profit, and margin of safety• Use both graphical and quantitative methodsSyllabus objective5.5.4Limitations of break-even• Evaluate limitations of break-even as a decision-making tool• Limitations include assumptions about linear costs/revenue, fixed prices, single products, and certaintySyllabus objective
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