Question

What is the break-even point?

• A. Cost received is more then revenue.
• B. Cost received is less then revenue.
• C. Gains are more then losses.
• D. The point where there is no gain no loss.

Answer 1

The correct option is D The point where there is no gain no loss.

In simple words, the break-even point can be defined as a point where total costs (expenses) and total sales (revenue) are equal. Break-even point can be described as a point where there is no net profit or loss. The firm just “breaks even.” Any company which wants to make normal profit, desires to achieve the break-even point. Graphically, it is the point where the total cost and the total revenue curves meet.