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AS Business Notes

Finance/Cash flow

Total Cost= Fixed Cost + Variable Cost

Profit= Total Revenue ­ Total Cost

Break Even= Fixed Cost "Divided" by Contribution per Unit **

Break-Even Advantages & Disadvantages

Advantages Disadvantages
Easy Assumes No Waste Of Materials
Quick Tells The Business How Much It NEEDS To Sell…

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Company's Own Profits (Means No Repayments)
Assets Can Be Sold To Generate Funds
Owners Own Money Can Be Injected Into The Company

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