BTEC First Business Unit 2 - Finance for Business
I was going to retire these pages in July 2021, but having looked at Google Analytics it seems people still use them. There's probably a business lesson there about knowing your client base or something...
Learning Aim B1: Understand the planning tools businesses use to predict when they will start making a profit
Businesses need to know how much they need to sell to break-even. This is the point at which they make no profit and no loss - they break-even.
Planning effectively to identify this point is a really helpful thing for businesses to do.
The Break-even Chart
Breakeven Charts - slides, including the basics of breakeven analysis
Labelled Breakeven Chart - just the chart with some labels on it
Breakeven Chart - an ambush assessment task!
The Break-even Formula
Once you can handle the chart you need to know how to use the Break-even Formula. Fortunately you don't need to remember the formula in the exam - it will always be given to you.
The Breakeven Formula - you don't need to remember this in an exam - but do need to know how to use it!
Pete's Pickles breakeven analysis - calculations to work through
Changes in the Break-even Chart
Changes in the Break-even Chart are quite tricky. I plan to produce some more materials to help revise this I think. For now, try this...
Changes in the breakeven chart - a table to summarise changes which might occur and their impacts
Reasons for using Break-even Analysis
Once you're able to use the chart and the formula you need to understand the reasons for using them.
Breakeven analysis - why it's important
Break-even analysis True/False to think about benefits and risks
Breakeven analysis - a table to summarise the benefits and risks associated with it