Difference between revisions of "Introduction to entrepreneurship/IENT103/Valuing/Break-even"

From WikiEducator
Jump to: navigation, search
m (Punctuation)
(Edit)
Line 1: Line 1:
−
[[File:Simple_balance_scales-02.jpg|320px|right]]Generally speaking, the value of a business is determined by its future profit potential. The pre-seed funding stage commences with your idea for a new business and initial funding for the entrepreneur to progress a working prototype or [https://en.wikipedia.org/wiki/Minimum_viable_product minimum viable product]. The objective of this phase is to achieve the break-even point, that is, the point where a business starts to make a profit. Therefore, you will need to know how to calculate the break-even and consider how long it might take to achieve this milestone for your planning.{{clear}}
+
[[File:Simple_balance_scales-02.jpg|320px|right]]Generally speaking, the value of a business is determined by its future profit potential. The pre-seed funding stage commences with your idea for a new business and initial funding for the entrepreneur to progress a working prototype or [https://en.wikipedia.org/wiki/Minimum_viable_product minimum viable product]. The objective of this phase is to achieve the break-even point, that is, the point where a business starts to make a profit. Therefore, you will need to know how to calculate the break-even point and consider how long it might take to achieve this milestone for your planning.{{clear}}
  
 
{{IDevice
 
{{IDevice

Revision as of 22:16, 11 February 2019

Simple balance scales-02.jpg
Generally speaking, the value of a business is determined by its future profit potential. The pre-seed funding stage commences with your idea for a new business and initial funding for the entrepreneur to progress a working prototype or minimum viable product. The objective of this phase is to achieve the break-even point, that is, the point where a business starts to make a profit. Therefore, you will need to know how to calculate the break-even point and consider how long it might take to achieve this milestone for your planning.
Icon define line.svg
Definitions
Break-even point
The break even point is the production or operational level where total revenues equals total expenses.
Fixed Costs
The expenses that are not dependent on the amount of goods or services produced by the business.
Variable Costs
Costs that are volume related and are paid per quantity or unit produced.



Icon reading line.svg
Reading

Read the following section of the Introduction to Business course published by Lumen Learning:

Tasks
Using the outputs from the financial statements learning challenge:

  • Estimate the break-even point for your start-up business, i.e how many units or services will you need to sell to break-even.
  • Estimate how long it will take for your start-up to break-even.


Retrieved from "https://wikieducator.org/index.php?title=Introduction_to_entrepreneurship/IENT103/Valuing/Break-even&oldid=1060627"