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Chart: Net Worth

Net Worth

889,922

554,269

318,266

156,900
51,113
1 2 3 4 5
Year

8.6 BREAK-EVEN ANALYSIS
Break-even is the point where the business neither makes profit nor loss. This means that at break-even,

the business is only able to pay up its expenses both fixed and variable cost without any excess. The
essence of break-even is to determine the number of sales that could lead to profitability

Year 1 Year 2 Year 3 Year4 Year 5
Fixed cost $ $ $ $ $
115,600 127,160 139,876 153,864 169,250
Variable Cost % 0% 0% 0% 0% 0%
Gross Margin % 100% 100% 100% 100% 100%

Break Even $ 115,600 $ 127,160 $ 139,876 $ 153,864 $ 169,250
Income
Revenue $ 165,000 $ 240,000 $ 312,000 $ 405,600 $ 527,280

The business is seen to break the even in the first year of business activities. This means that there must

be more than $115,600 worth of sales yearly before any profit can be recorded. The above analysis can

be seen in the below graph showing the breakeven income and revenue.

CONFIDENTIAL - DO NOT DISSEMINATE. This business plan contains confidential, trade-secret information and is shared only with the understanding that you will not
share its contents or ideas with third parties without the express written consent of the plan author.

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