Break Even Point

The break-even point refers to the amount of revenue necessary to cover the total fixed and variable expenses incurred by a company within a specified time period. This revenue could be stated in monetary terms, as the number of units sold or as hours of services provided.

The break-even point also can be considered as the point in time when revenue forecasts are exactly equal to the estimated total costs. This is where a company’s losses end and its profits start to accumulate. At this point, a project, product or business is financially viable.