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The Break-Even Point. The break-even point (BEP) in economics, business —and specifically cost accounting —is the point at which total cost and total revenue are equal, i.e. "even". In layman's terms, after all costs are paid for there is neither profit nor loss. [ 1][ 2] In economics specifically, the term has a broader definition; even if ...
Sales variance. Sales variance is the difference between actual sales and budgeted sales. [ 1 ] It is used to measure the performance of a sales function, and/or analyze business results to better understand market conditions. There are two reasons actual sales can vary from planned sales: either the volume sold varied from the expected ...
Break-even (or break even ), often abbreviated as B/E in finance (sometimes called point of equilibrium), is the point of balance making neither a profit nor a loss. It involves a situation when a business makes just enough revenue to cover its total costs. [ 1] Any number below the break-even point constitutes a loss while any number above it ...
While January was the "Month of the Rising Market," encouraged by political compromises, an improving employment landscape, and strong corporate earnings, February may be the far less illustrious ...
The point of total assumption ( PTA) is a point on the cost line of the profit-cost curve determined by the contract elements associated with a fixed price plus incentive-Firm Target (FPI) contract above which the seller effectively bears all the costs of a cost overrun. The seller bears all of the cost risk at PTA and beyond, due to a dollar ...
Contribution margin analysis is a measure of operating leverage; it measures how growth in sales translates to growth in profits. The contribution margin is computed by using a contribution income statement, a management accounting version of the income statement that has been reformatted to group together a business's fixed and variable costs.
There are two markets each with its own price (Pf and Pt in the next diagram). The aggregate market is constructed from the first two. That is, point C is a horizontal summation of points A and B (and likewise for all other points on the net marginal revenue curve (NMRa)). The total optimum quantity (Q) is the sum of Qf plus Qt.
Total addressable market (TAM), or total available market, is the total market demand for a product or service, [ 2] calculated in annual revenue or unit sales if 100% of the available market is achieved. Serviceable available market (SAM) is the portion of TAM that is reachable and can potentially be served by a company's products or services.