3. Operating break-even graph analysis Aa Aa When does a firm achieve it's operating break-even point? Your company is considering altering its operations going forward but is unsure about how this should happen. You've decided to take it upon yourself to complete an operating break-even analysis for the company. Use the information in the table to complete the operating break-even graph that follows. Operational Information for Port Co. Selling price per unit $15 Variable cost per unit $5 Fixed operating costs $350 million Use the graph to determine the sales revenue and operating costs at various levels of production, as well as the
Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
![3. Operating break-even graph analysis
Aa Aa
When does a firm achieve it's operating break-even point?
Your company is considering altering its operations going forward but is unsure about how this should happen.
You've decided to take it upon yourself to complete an operating break-even analysis for the company. Use the
information in the table to complete the operating break-even graph that follows.
Operational Information for Port Co.
Selling price per unit
$15
Variable cost per unit
$5
Fixed operating costs
$350 million
Use the graph to determine the sales revenue and operating costs at various levels of production, as well as the
operating break-even point.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F8e241797-399b-4dac-ab9c-2b3b625a3d13%2F6d731cde-f819-49e0-8d3b-dfbd353a3063%2Ffir3q69_processed.png&w=3840&q=75)
![Tool tip: Mouse over the points on the graph to see their coordinates.
REVENUES AND COSTS (Millions of dollars)
1000
Break-even Point
800
Operating Costs
600
Sales Revenues
400
200
20
40
60
80
100
UNITS PRODUCED AND SOLD (Millions)
Clear All
Assume that the actual sales for the current period equal 30 million units. Considering your operating break-even
analysis, will Port Co. be profitable at this level of sales?
Not enough information given
Yes
No](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F8e241797-399b-4dac-ab9c-2b3b625a3d13%2F6d731cde-f819-49e0-8d3b-dfbd353a3063%2Fi56o5f_processed.png&w=3840&q=75)
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