DQ2C - generated is exactly equal to fixed costs. The...

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What is the breakeven point? What decisions does the breakeven point help an organization to make? What financial actions might an underperforming organization take to reach breakeven point? The breakeven point tells a firm what volume of sales is required in order for it to cover all of its fixed costs, while producing no profit. This is the volume when the total contribution margin
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Unformatted text preview: generated is exactly equal to fixed costs. The breakeven point can help a firm plan for the volume necessary to cover its costs, and thereby know at what point they will begin to generate profits. If a firm is not reaching break even, they will need to either decrease costs (fixed or variable) increase sales volume, or increase sales price....
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This note was uploaded on 04/11/2011 for the course FIN 370 taught by Professor Unknown during the Spring '08 term at University of Phoenix.

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