Cash break-even analysis
A)is helpful in analyzing the short-term outlook of the firm, particularly when it is in trouble financially.
B)is important when analyzing long-term profitability.
C)includes depreciation expense as a fixed cost when calculating the degree of financial leverage.
D)None of the options

Question

Quizplus · Accepted Answer

Cash break-even analysis helps in analyzing the short-term outlook of a firm by determining the amount of sales required to cover all cash expenses, which is particularly helpful when the firm is facing financial difficulties.

Cash Break-Even Analysis