ECONOMICS

Detailed explanation-1: -As illustrated in the graph above, the point at which total fixed and variable costs are equal to total revenues is known as the break even point. At the break even point, a business does not make a profit or loss. Therefore, the break even point is often referred to as the “no-profit” or “no-loss point.”

Detailed explanation-2: -The break-even point is calculated by dividing the total fixed costs of production by the price per individual unit less the variable costs of production. Fixed costs are costs that remain the same regardless of how many units are sold.

Detailed explanation-3: -The breakeven point is defined as the point where the firm’s profit is equal to zero. At this point, the firm’s sales revenue is just enough to cover all the total costs. Therefore, the breakeven point can be referred to as the point where the total sales revenue is equal to the total cost.

Detailed explanation-4: -Key Takeaways 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 costs of production equal the revenues for a product.