Calculate break-even point

Calculate break-even point is essential for businesses to determine the sales volume needed to cover costs. The break-even point is where total revenue equals total expenses, resulting in neither profit nor loss. To calculate it, divide fixed costs by the difference between. Unit selling price and variable cost per unit. This formula helps businesses understand how many units they need to sell to cover their costs, providing a clear financial target. Knowing the break-even point aids in pricing strategies. Cost management, and financial planning, ensuring businesses can set realistic sales goals and make informed decisions to achieve profitability. By identifying the break-even point, businesses can set sales targets. Make informed pricing decisions, and manage costs effectively.