The first step in preparing a break-even analysis is to break business expenses down into "fixed" and "variable" categories.

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This is true. The first step in preparing a break-even analysis is to distinguish between fixed and variable expenses. Fixed expenses refer to those expenses that do not fluctuate with changes in production levels, while variable expenses change in relation to production. By separating fixed and variable expenses, businesses can ascertain their break-even point, which is the level of production at which total revenue equals total expenses, and they begin to generate profit.

The First Step in Preparing a Break-Even Analysis Is to Break