Break-even Analysis

Chapter 3: Initial Assessment - Page 3.6

Break-even Analysis Chart

Break-even Chart

The Break-even chart shows that the company needs to sell about 1,200 units per month to break even.

This chart, based on the table example from the previous page, shows that the company needs to sell approximately 1,200 units in order to cross the break-even line. This is a classic business chart that helps you consider your bottom-line financial realities. Can you sell enough to make your break-even volume?

Of course the break-even analysis depends on assumptions made for average per-unit revenue, average per-unit cost, and fixed costs. These are rarely exact assumptions. Palo Alto Software's business resource website www.Bplans.com offers an easy-to-use online Break-even Analysis Calculator.

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