Break-even chart
Break-even charts can be produced to make the information easier to understand and analyse. The above break-even chart shows the sales revenue, total costs and fixed costs lines. The point at which the sales revenue line crosses the total costs line represents the break-even point.
Formula can also be used to interpret break-even information:
\(\boldsymbol{break\!\!-\!\!even \ point=\frac{fixed\ costs}{sales\, -\, variable\ costs}}\)
\(\boldsymbol{selling\ price=\frac{sales\ revenue}{output}}\)
\(\boldsymbol{variable\ cost\ per\ unit=\frac{total\ cost\,-\,fixed\ cost}{sales\ revenue}}\)
