UGBA 10 Lecture Notes - Lecture 2: Unsecured Debt, Angel Investor, Dividend Yield

• School: Berkeley
• Department: Business Administration Undergraduate Program
• Course: UGBA 10
• Professor: Briginshaw

Document Summary

Fixed cost: does not depend on units sold. Variable cost: rises as more units are sold. Understand the different roles of debt as a source of business financing, equity as a source of business financing. Costs are made p of variable and fixed costs. Variable costs these costs go up w/ sales eg ingredients supplies or product, hourly labor, commissions. Fixed costs these are the same however much you sell eg. rent, fixed salaries. Where costs = fixed costs + variable costs. Suppose we have a product which sells for and costs variable costs each unit. Profit = np nv f p-v is called contribution margin ex. Pippa"s lemonade stand glasses and table rental: per day (to mommy) price per lemonade sh. 60 cost of lemon and sugar sh. 40. How many glasses to sell to break even each lemonade provides 20c of contribution. If variable cost was 65 cents per glass could never break even.