Break-Even Point (BEP) in Excel is the first landmark every business wants to achieve to sustain itself in the market. So, even when you work for other companies as an Analyst, they may want you to find the Excel break-even point of business.
Now, we will see what precisely the break-even point is meant for. For example, your monthly expenditure is 15,000, including all the rental, communications, food, beverages, etc. But, on the other hand, your per day salary is 1,000. So, when you earn 15,000, it becomes a break-even point for you. Anything made after the break-even point will be considered a profit.
So in business terms, if the amount of profit and expenses are equal, that is called the break-even point. So in simple terms, the break-even point is where a project’s cash inflow should equal the project’s cash outflow.
The cost could come in multiple ways, and we classify that into Fixed Cost, Variable Cost, and other miscellaneous costs. Now, we will see some real-time examples of finding the break-even point in Excel analysis.
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