Using break-even analysis A new product is expected to have sales of $100,000, variable costs of 60%...

Using break-even analysis

A new product is expected to have sales of $100,000, variable costs of 60% of sales, and fixed costs of $20,000.

1. Using graph paper, construct a break-even chart and label the sales line, total cost line, fixed cost line, break-even point, and net income and net loss areas.

2. From the chart, identify the break-even point and the amount of income or loss if sales are $100,000.