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Break Even analysis

This week has focused on using several cost analysis tools to determine how well products contribute to a company’s profitability. However, all of these tools are internally used and not required to be published outside of an organization. Instead, external stakeholders rely on the three key financial statements reviewed in Unit 1:


  • Income Statement

  • Balance Sheet

  • Statement of Cash Flows)


If a company’s CVP analyses showed it was not operating at break-even, where on the financial statements might one be able to see this impact (i.e., specific line items on the statements)?


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