#business

2 public notes

Break-even depends on what each sale contributes

A business breaks even when its total revenue equals its total costs. If a product sells for ₹100 and costs ₹60 per unit to supply, each sale contributes ₹40 towards fixed costs. With ₹4,000 in fixed costs, the business needs 100 units to break even under these assumptions.

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revenue

Revenue is the sale; profit is what remains after costs

Revenue records the value of sales, while profit reflects the costs deducted from that revenue. A shop selling 100 notebooks for ₹50 each earns ₹5,000 in revenue. If the associated total costs are ₹4,200, the remaining ₹800 is profit under those simplified assumptions.

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