{"id":411,"date":"2018-04-17T21:23:22","date_gmt":"2018-04-17T21:23:22","guid":{"rendered":"https:\/\/courses.lumenlearning.com\/wm-accountingformanagers\/?post_type=chapter&#038;p=411"},"modified":"2024-04-29T16:54:37","modified_gmt":"2024-04-29T16:54:37","slug":"break-even-point","status":"publish","type":"chapter","link":"https:\/\/courses.lumenlearning.com\/wm-accountingformanagers\/chapter\/break-even-point\/","title":{"raw":"Break-Even Point","rendered":"Break-Even Point"},"content":{"raw":"<div class=\"textbox learning-objectives\">\r\n<h3>Learning Outcomes<\/h3>\r\n<ul>\r\n \t<li>Define the break-even point<\/li>\r\n<\/ul>\r\n<\/div>\r\nHow many apples does Farmer Joe need to sell to break even?\r\n\r\n<iframe src=\"\/\/plugin.3playmedia.com\/show?mf=4306762&amp;p3sdk_version=1.10.1&amp;p=20361&amp;pt=375&amp;video_id=ZihWEVWCJYk&amp;video_target=tpm-plugin-wfoizdxb-ZihWEVWCJYk\" width=\"800px\" height=\"450px\" frameborder=\"0\" marginwidth=\"0px\" marginheight=\"0px\"><\/iframe>\r\n\r\nThe break even point can be defined as the exact point where sales-expenses = zero. So essentially, you are not making money, but you are not losing money either. This is the point where selling one less item would create a loss and selling one more item would create a profit situation. There are two methods we can use to figure out our break even point:\r\n<ol>\r\n \t<li style=\"font-weight: 400;\">The equation method<\/li>\r\n \t<li style=\"font-weight: 400;\">The formula method<\/li>\r\n<\/ol>\r\nWe will discuss both methods in detail, but let\u2019s start with a new\u00a0company and a new product! The widgets are starting to get boring. Whether we are talking about apples, widgets or kayaks, the process is the same.\r\n\r\nThe Minnesota Kayak Company has come to you to help them determine the break even point on a new line of racing kayaks they plan to introduce to the market. These are some pricy kayaks and they want to insure that the use of their manufacturing facility will make sense for this new line.\r\n\r\nAre you ready to get busy?\r\n<div class=\"textbox tryit\">\r\n<h3>Practice Questions<\/h3>\r\nhttps:\/\/assess.lumenlearning.com\/practice\/d21ca669-88d7-4f0a-9811-d2b12c5c0fc7\r\n<\/div>","rendered":"<div class=\"textbox learning-objectives\">\n<h3>Learning Outcomes<\/h3>\n<ul>\n<li>Define the break-even point<\/li>\n<\/ul>\n<\/div>\n<p>How many apples does Farmer Joe need to sell to break even?<\/p>\n<p><iframe loading=\"lazy\" src=\"\/\/plugin.3playmedia.com\/show?mf=4306762&amp;p3sdk_version=1.10.1&amp;p=20361&amp;pt=375&amp;video_id=ZihWEVWCJYk&amp;video_target=tpm-plugin-wfoizdxb-ZihWEVWCJYk\" width=\"800px\" height=\"450px\" frameborder=\"0\" marginwidth=\"0px\" marginheight=\"0px\"><\/iframe><\/p>\n<p>The break even point can be defined as the exact point where sales-expenses = zero. So essentially, you are not making money, but you are not losing money either. This is the point where selling one less item would create a loss and selling one more item would create a profit situation. There are two methods we can use to figure out our break even point:<\/p>\n<ol>\n<li style=\"font-weight: 400;\">The equation method<\/li>\n<li style=\"font-weight: 400;\">The formula method<\/li>\n<\/ol>\n<p>We will discuss both methods in detail, but let\u2019s start with a new\u00a0company and a new product! The widgets are starting to get boring. Whether we are talking about apples, widgets or kayaks, the process is the same.<\/p>\n<p>The Minnesota Kayak Company has come to you to help them determine the break even point on a new line of racing kayaks they plan to introduce to the market. These are some pricy kayaks and they want to insure that the use of their manufacturing facility will make sense for this new line.<\/p>\n<p>Are you ready to get busy?<\/p>\n<div class=\"textbox tryit\">\n<h3>Practice Questions<\/h3>\n<p>\t<iframe id=\"assessment_practice_d21ca669-88d7-4f0a-9811-d2b12c5c0fc7\" class=\"resizable\" src=\"https:\/\/assess.lumenlearning.com\/practice\/d21ca669-88d7-4f0a-9811-d2b12c5c0fc7?iframe_resize_id=assessment_practice_id_d21ca669-88d7-4f0a-9811-d2b12c5c0fc7\" frameborder=\"0\" style=\"border:none;width:100%;height:100%;min-height:300px;\"><br \/>\n\t<\/iframe>\n<\/div>\n\n\t\t\t <section class=\"citations-section\" role=\"contentinfo\">\n\t\t\t <h3>Candela Citations<\/h3>\n\t\t\t\t\t <div>\n\t\t\t\t\t\t <div id=\"citation-list-411\">\n\t\t\t\t\t\t\t <div class=\"licensing\"><div class=\"license-attribution-dropdown-subheading\">CC licensed content, Original<\/div><ul class=\"citation-list\"><li>Break-Even Point. <strong>Authored by<\/strong>: Freedom Learning Group. <strong>Provided by<\/strong>: Lumen Learning. <strong>License<\/strong>: <em><a target=\"_blank\" rel=\"license\" href=\"https:\/\/creativecommons.org\/licenses\/by\/4.0\/\">CC BY: Attribution<\/a><\/em><\/li><\/ul><div class=\"license-attribution-dropdown-subheading\">All rights reserved content<\/div><ul class=\"citation-list\"><li>Break Even Point- easily explained!. <strong>Authored by<\/strong>: VAHKNeumi. <strong>Located at<\/strong>: <a target=\"_blank\" href=\"https:\/\/youtu.be\/ZihWEVWCJYk\">https:\/\/youtu.be\/ZihWEVWCJYk<\/a>. <strong>License<\/strong>: <em>All Rights Reserved<\/em>. <strong>License Terms<\/strong>: Standard YouTube License<\/li><\/ul><\/div>\n\t\t\t\t\t\t <\/div>\n\t\t\t\t\t <\/div>\n\t\t\t <\/section>","protected":false},"author":62559,"menu_order":14,"template":"","meta":{"_candela_citation":"[{\"type\":\"original\",\"description\":\"Break-Even Point\",\"author\":\"Freedom Learning Group\",\"organization\":\"Lumen Learning\",\"url\":\"\",\"project\":\"\",\"license\":\"cc-by\",\"license_terms\":\"\"},{\"type\":\"copyrighted_video\",\"description\":\"Break Even Point- easily explained!\",\"author\":\"VAHKNeumi\",\"organization\":\"\",\"url\":\"https:\/\/youtu.be\/ZihWEVWCJYk\",\"project\":\"\",\"license\":\"arr\",\"license_terms\":\"Standard YouTube License\"}]","CANDELA_OUTCOMES_GUID":"804bd01d-fd31-4314-8765-6285348d6423, 5fa53ee0-b278-4a13-b15a-2440053ccc57","pb_show_title":"on","pb_short_title":"","pb_subtitle":"","pb_authors":[],"pb_section_license":""},"chapter-type":[],"contributor":[],"license":[],"class_list":["post-411","chapter","type-chapter","status-publish","hentry"],"part":107,"_links":{"self":[{"href":"https:\/\/courses.lumenlearning.com\/wm-accountingformanagers\/wp-json\/pressbooks\/v2\/chapters\/411","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/courses.lumenlearning.com\/wm-accountingformanagers\/wp-json\/pressbooks\/v2\/chapters"}],"about":[{"href":"https:\/\/courses.lumenlearning.com\/wm-accountingformanagers\/wp-json\/wp\/v2\/types\/chapter"}],"author":[{"embeddable":true,"href":"https:\/\/courses.lumenlearning.com\/wm-accountingformanagers\/wp-json\/wp\/v2\/users\/62559"}],"version-history":[{"count":9,"href":"https:\/\/courses.lumenlearning.com\/wm-accountingformanagers\/wp-json\/pressbooks\/v2\/chapters\/411\/revisions"}],"predecessor-version":[{"id":4092,"href":"https:\/\/courses.lumenlearning.com\/wm-accountingformanagers\/wp-json\/pressbooks\/v2\/chapters\/411\/revisions\/4092"}],"part":[{"href":"https:\/\/courses.lumenlearning.com\/wm-accountingformanagers\/wp-json\/pressbooks\/v2\/parts\/107"}],"metadata":[{"href":"https:\/\/courses.lumenlearning.com\/wm-accountingformanagers\/wp-json\/pressbooks\/v2\/chapters\/411\/metadata\/"}],"wp:attachment":[{"href":"https:\/\/courses.lumenlearning.com\/wm-accountingformanagers\/wp-json\/wp\/v2\/media?parent=411"}],"wp:term":[{"taxonomy":"chapter-type","embeddable":true,"href":"https:\/\/courses.lumenlearning.com\/wm-accountingformanagers\/wp-json\/pressbooks\/v2\/chapter-type?post=411"},{"taxonomy":"contributor","embeddable":true,"href":"https:\/\/courses.lumenlearning.com\/wm-accountingformanagers\/wp-json\/wp\/v2\/contributor?post=411"},{"taxonomy":"license","embeddable":true,"href":"https:\/\/courses.lumenlearning.com\/wm-accountingformanagers\/wp-json\/wp\/v2\/license?post=411"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}