Break-Even Point (BEP)

The sales level at which revenue equals total costs — neither profit nor loss

The break-even point (BEP) is the level of sales at which total revenue equals total costs — no profit, no loss. Below BEP the business loses money; above BEP it earns profit.

BEP (units) = Fixed costs ÷ (Price − Variable cost)
BEP (revenue) = BEP (units) × Price

Fixed costs: $10,000 · Price: $150 · Variable cost: $60
BEP = 10,000 ÷ (150 − 60) = 112 units

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