520 |
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|b The breakeven point is considered as the point, which the total sales revenues is equal to the total stable and changing expenditures. \ The idea of breakeven analysis depends on that profits do not grow through commodities production only, and not through selling a number of commodities, the thing that the accounting rules impose on this field. It is therefore to sell specific volume from the commodities that their sale outcome covers the expenditures of sales, and fixed periodical costs, and the remaining goods is considered net profit achieved by the establishment at a specific period. \ If the establishment has sold a volume exceeding the balanced volume or the breakeven, the outcome of its activities will lead to profits, and on the contrary, in the case of the decreasing of sales volume down the volume of the breakeven, the establishment will lose. \ The study of analyzing the relationship between cost, volume and profit is used in planning and performance evaluation. \ According to the above mentioned, the management of the establishment should be aware of the nature of relationship among those variables. \ Moreover, it should be specific and CLear, otherwise it will encounter greater difficulties in the processes of planning and imposing control and performance evaluation.
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