BREAK-EVEN: JUST ANOTHER ACADEMIC AMUSEMENT OR USEFUL ADDITION TO THE FINANCIAL PRACTITIONERS’ TOOLBOX


DOI: https://doi.org/10.15308/finiz-2014-45-47
Authors:
Nemanja Stanišić
Goranka Knežević

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Keywords:
break-even analysis, operating leverage, contribution margin.


Abstract:
Break-even analysis is a mainstream topic in modern business education. Its simplicity and elegance are a product of some important assumptions on which it is built. In this paper, we use a real life financial data set to examine the applicability of the analysis in both its classical – net and modified – operating forms. The results indicate that the general applicability of break-even analysis is rather limited, but also that its “operating” form is noticeably more consistent with the assumptions.

CITATION:

IEEE format

N. Stanišić, G. Knežević, “BREAK-EVEN: JUST ANOTHER ACADEMIC AMUSEMENT OR USEFUL ADDITION TO THE FINANCIAL PRACTITIONERS’ TOOLBOX,” in FINIZ 2014 - The Role of Financial Reporting in Corporate Governance, Belgrade, Singidunum University, Serbia, 2014, pp. 45-47. doi: 10.15308/finiz-2014-45-47

APA format

Stanišić, N., Knežević, G. (2014). BREAK-EVEN: JUST ANOTHER ACADEMIC AMUSEMENT OR USEFUL ADDITION TO THE FINANCIAL PRACTITIONERS’ TOOLBOX. Paper presented at FINIZ 2014 - The Role of Financial Reporting in Corporate Governance. doi:10.15308/finiz-2014-45-47

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