Scribd
Upload
10 views

Break Even Charts

Uploaded by

Ishtee Rughoobur
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
10 views

Break Even Charts

Uploaded by

Ishtee Rughoobur
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
You are on page 1/ 2

Break even charts

Break even charts are graphs which show how costs and revenues of a

business change with sales. They show the level of sales the business must

make in order to breakeven.

Break-even level of output is the quantity that must be produced/sold for

total revenue to equal total costs.

Break-even level of output is where TOTAL REVENUE = TOTAL COSTS. At

the break-even level of output the business makes neither profit nor loss.

TOTAL COSTS = TOTAL FIXED COSTS + TOTAL VARIABLE COSTS

TOTAL REVENUE = QUANTITY SOLD x PRICE

(It is the income during a period of time from the sale of goods or services)

The break-even level of output may be calculated as follows:

1. By calculation (formula)
2. By drawing a break even chart

1. By calculation(formula)

Break-even point = FIXED COSTS

SELLING PRICE – VARIABLE COSTS

SELLING PRICE – VARIABLE COSTS = CONTRIBUTION


2. Drawing Break Even charts

You might also like