Both fixed costs and variable costs need to be calculated when doing a break-even analysis.

Question

Quizplus · Accepted Answer

Both fixed and variable costs are important components in calculating the break-even point. Fixed costs are expenses that do not fluctuate with changes in production or sales, while variable costs are expenses that do vary with changes in production or sales. Both types of costs must be considered to accurately determine the point at which a business is neither making a profit nor a loss.

Both Fixed Costs and Variable Costs Need to Be Calculated