Boeing-Breakeven Analysis

 Boeing-Breakeven Examination Essay

Boeing Co. -Breakeven Analysis

The Boeing 737-900ER was released in July 2006 and made it is first delivery to Indonesia's Lion Air flow in 3 years ago. The price of the 737-900ER ranges from $74, 000, 000-$89, 000, 000 per airplane. The purpose of this assignment is always to apply breakeven analysis into a project inside Boeing employing data from the company's internet site as well as fabricated information utilized to apply the tool. The fictitious information was used only because Boeing didn't provide a malfunction of costs per system.

A few assume that Boeing's annual fixed cost to get the 737-900ER are $980 million, and its variable price per airline is $65 million. In order to calculate the break even point, the contribution margin for every plane need to first be calculated as follows (Note: Assuming the price of the plane is $89, 000, 000): 1 . Revenue price - Variable cost per planes: 89-65=24 mil

Up coming, since the total fixed cost is given, the break even point can be calculated. 2 . Make your money back point= 980/24= 40. 83 planes

Hence, Boeing must sell about 41 planes in order to accomplish their break even point.

Module a couple of: Session Long ProjectPage a few

In terms of revenue dollars, the figure will be: 40. 83 x fifth there’s 89 million= 3634. 17 million or 3. 634 billion dollars dollars.

In conclusion, the 737-900ER's total break even stage was low, indicating that the overall operations of the project happen to be within a affordable scope and there's no big threat of potential issues within the company, unless the break even level reaches their sales amount, which could result in a problem in the event they become limited on methods. Break even point analysis is a wonderful tool transmit helpful information to corporations, but its lack of ability to demonstrate how income changes as activity changes within the organization calls for additional methods to assist in the overall examination.


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