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| Topic: |
Business
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| Number of pages / Number of words: |
4 / 953 |
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This can be used to calculate a set target for the company if it wished to take on one or multiple proposals, a good way to plan the future of the company, the disadvantages of the break-even analysis is that it displayed as a straight line which is based on average over the 250 customers, this does not take into account of variations in sales such as discounts or events which have a lower gross profit or those which are higher, hence distorting the sales line, therefore the break even point that has been established will be inaccurate...
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(Kotas, 1999) The margin of safety could be higher if the company decided to cut back on some expenses where possible, increasing its client base and/or implementing a system which can reduce costs.
The two proposals, computer system and Advertising campaign differ in payback period due to the larger investment required for the advertising campaign...
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