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Break-Even Analysis & Business Plan

You are considering the start of a small ; business that sells generator gaskets. ; ; According to your market research, you can sell each gasket for ; $12. ; Your fixed costs for the business ; are estimated at $35,000 and you estimate your variable costs to be $6 per ; gasket.

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  1. How many units will you have to sell to break ; even in the business? Calculate the breakeven point in units, and then in ; dollars.
  2. In order to make the business a worthwhile ; activity, you require a $20,000 profit. ; ; How many units would you have to sell to make this venture worthwhile?
  3. Explain how breakeven analysis can be useful to ; the person starting a small business and/or to an existing small business.

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"FIRST15"

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