If total fixed costs increases while the variable costs and sales price are kept unchanged, the break-even point will increase, and therefore more units will be sold to break-even quantity.
Break-even analysis describes the process of calculating as well as examining the margin of safety for any entity which is based on the revenues collected and associated costs.
In the other words, the break even analysis shows how many sales are required to pay for the cost of doing business.
Analyzing different price levels at the various levels of demand, the break-even analysis determines which level of sales are necessary to cover the company's total fixed costs.
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