August 20, 2007
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What increases a breakeven point?
The breakeven point will increase when the amount of fixed costs and expenses increases. The breakeven point will also increase when the variable expenses increase without a corresponding increase in the selling prices.
A company with many products can see its breakeven point increase when the mix of products changes. In other words, if a greater proportion of lower contribution margin products are sold, the breakeven point will increase. (Contribution margin is selling price minus variable expenses.)
Learn more about Breakeven Point.
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