In this article we will discuss about break-even analysis’s chart. The break-even point represents the volume of sales at which revenues equal expenses — that is, at which profit is zero. The break-even volume is calculated at by dividing fixed cost (costs that do not vary with output) by the contribution margin per unit, that is, selling price minus variable [...]
In this article we will discuss about:- 1. Introduction to Break-Even Analysis 2. Assumptions of Break-Even Analysis 3. Limitations. Introduction to Break-Even Analysis: Break-even analysis is of vital importance in determining the practical application of cost functions. It is a function of three factors, i.e., sales volume, cost and profit. It aims at classifying the dynamic relationship existing between total [...]
In this article we will discuss about:- 1. Meaning of Break-Even Point 2. Determination of Break-Even Point 3. Types. Meaning of Break-Even Point: The break-even point may be defined as that level of sales in which total revenues equal total costs and net income is equal to zero. This is also known as no-profit no-loss point. This concept has been [...]