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breakeven analysis

breakeven analysis

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Answer #1

Breakeven analysis means a technique which is used by all the companies in order to recover all the costs(especially the fixed cost) from the required sales to be made. At this Break Even Point there will be no Profit or loss to the company, such that all its costs are recovered.

Break Even Point(In Units) = Fixed Cost/Contribution Margin.

Breakeven Point(In $) = Fixed Expenses/ Contribution Margin ratio.

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