Join Earl Kay Stice for an in-depth discussion in this video Break even, part of Accounting Foundations.
Another illustration of the use of managerial accounting…is break-even analysis.…And let me explain this by the use of a real example…based on an experience my wife had.…My wife's name is Ramona and many years ago, back in 1985,…she was helping organize a charity banquet and a raffle.…So you bought a ticket to go to this charity banquet.…The ticket cost $250, pretty expensive.…Seems expensive now. It was real expensive back in 1985.…Your ticket was thrown into a container…when you went to the charity banquet,…and at the end of the banquet…they randomly stirred them all up,…pulled out one ticket, if your ticket was pulled out,…you got a brand new car costing $18,000.…
That doesn't sound like much.…Back in 1985 that was a really nice car.…The other cost is this.…It was a very fancy banquet so the caterer…was charging $40 per person for the banquet.…So let's review those three numbers.…People come to the charity banquet and pay $250 for each ticket.…The caterer is charging the charity $40…to give food to each person who comes.…
- What is accounting?
- Working with balance sheets and income statements
- Determining the costs of products
- Performing break-even analysis
- Determining average and marginal tax rates
- Understanding tax deductions and credits
Skill Level Appropriate for all
Financial Literacy: Reading Financial Reportswith Rudolph Rosenberg1h 25m Appropriate for all
Making Investment Decisionswith Rudolph Rosenberg56m 25s Appropriate for all
1. Basics of Accounting
2. Financial Accounting
3. Managerial Accounting
4. Income Taxes
Next steps3m 9s
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