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Analyse the importance of the break even analysis in supporting the achievement of strategic aims and objectives.
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M2 Analyse the importance of the break even analysis in supporting the achievement of strategic aims and objectives. Break even happens when sales and total costs are the equal, meaning that no profit or no loss is made in the business. To find out the break even point we can use two ways, one by using the break even formula which is FC/ SP - VC, and the other way is to plot a break even graph which consists of three lines which are the fixed cost; costs that can not be changed, sales revenue; the sale that a business makes, and the variable costs; the costs that can change varying on other things in the business. The break even point on the graph in the point where the sales revenue and total costs met. It is very important for a business to know where they are breaking even so that they...
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