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Corporate Entrepreneurship: How to Create a Thriving Entrepreneurial Spirit Throughout Your Company
book

Corporate Entrepreneurship: How to Create a Thriving Entrepreneurial Spirit Throughout Your Company

by Robert Hisrich, Claudine Kearney
September 2011
Intermediate to advanced
288 pages
7h 35m
English
McGraw-Hill
Content preview from Corporate Entrepreneurship: How to Create a Thriving Entrepreneurial Spirit Throughout Your Company

Break-Even Analysis

Break-even analysis uses fixed and variable costs to determine the amount needed to become profitable. Regardless of output, fixed costs remain constant and variable costs change over time. Break-even analysis is useful for decisions regarding eliminating or introducing certain products or projects. This is particularly important for a corporate entrepreneurship to ensure efficiency and effectiveness in utilizing resources. Organizations break even when total costs equal total revenue earned:

P(x) = FC + VC(x)

Where: P = selling price of the new product

x = break-even point

FC = fixed costs

VC = variable costs

This break-even equation allows various prices to be used to determine various break-even points. These prices should ...

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Publisher Resources

ISBN: 9780071763165