Question

What information provided by a
computing the break-even point? Is this information on
statement? Explain your answer.

Answer 1

Break-Even Point

Explanation:

• According to Accounting Coach, the break-even point determines the amount of sales needed to achieve a net income of zero. It shows the purpose when a company's revenue equals total fixed costs plus variable costs, and its fixed costs equal the contribution margin.

• In accounting, the breakeven point is calculated by dividing the fixed costs of production by the price per unit minus the variable costs of production.

• The breakeven point is the level of production at which the prices of production equal the revenues for a product.