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Potential investors,in analyzing the profit potential for a distressed property,generally consider a financial framework including the acquisition phase,the holding period phase and the disposition phase.
Variable Costs
These are expenses that vary directly with the level of production or sales volume; they rise as production increases and fall as production decreases.
Contribution Margin Ratio
The percentage of sales revenue that remains after deducting variable costs, used to cover fixed costs and generate profit.
Variable Cost
Costs that change in proportion to the level of goods or services produced by a business.
Contribution Margin
The gap between the income from sales and variable expenses, which serves to offset fixed expenses and produce earnings.
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