Break-even sales will help you understand you minimum amount of sales revenue needed before making a profit.
Key
BES = Breakeven Sales
FE = Fixed Expenses
VE = Variable Expenses
ESP = Expected Sales Percentage of Goods and Services
NI = Needed Inventory
NS = Needed Sales
BES = FE / (1 – VE)
FE = 9000
VE = 60%
BES = 9000 / (1 – .6)
BES = 22,500
NS = BES / ESP
ESP = 80%
NS = 22,500 / 80%
NS = 28,125
NI = NS * VE
NI = 28,125 * .6
NI = 16,875
–
10/22/2001 – Originally posted
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About Michael Cannon
Hello, I'm Michael Cannon, Peichi's smiling man, an adventurous water-rat, chief technology officer, cyclist, poet, WWOOF'er and world traveler.
