Break-Even Equation(redirected from Break Even Equation)
An equation representing the sales a company requires to simply to cover costs, without losing money or making a profit. A company needs to at least break even in order to make the expense of producing a product worth the effort. As a result, a breakeven equation is an important feature in evaluating the risk of an activity. Breakeven equations calculate the relationship between the fixed costs, variable costs and revenue of the product.