Break-Even Analysis Worksheet Template Page 3
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3c. Break-even =
2380___
= 305.128 units
(10-2.20)
d. Therefore Company ‘A’ needs to sell 306 units to break-even.
5.
Write an explanation of gross profit margins.
Gross profit divided by total revenues.
6.
Give the definitions for debt and liquidity ratios and explain their importance.
Debt Ratio: A debt ratio measures the proportion of debt that a company
has relative to its assets.
Liquidity Ratios: Liquidity ratios can be beneficial at assessing the
company’s ability to pay back its creditors, expenses, and other loans.
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