Register now or log in to join your professional community.
Explain its effectiveness in company .
Break-even point in the company if equal means that this company is equally divided the profits and losses
this is the point which Total Revenue equal Total Costthere is no Profit (Zero) & no losses(Zero)
The Break-Even Point is that level of activity where total revenue equals total cost.
In simple words, the break-even point can be defined as a point where total costs (expenses) and total sales (revenue) are equal. Break-even point can be described as a point where there is no net profit or loss. The firm just “breaks even.” Any company which wants to make abnormal profit, desires to have a break-even point. Graphically, it is the point where the total cost and the total.
Break Even Point in a company is a level of sales at which the company's profit is zero. Its effectiveness in company is that it will answer the questions such as how much would the company have to sell to make a profit for a certain period or how much would the company have to sell to avoid incurring a loss.
