MATH 1505 Lecture 8: Break Even and Cash Flow
5 Mar 2018
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The point at which total cost and total revenue are equal: there is no net loss or gain, and one has "broken even. " A profit or a loss has not been made, although opportunity costs have been. "paid", and capital has received the risk-adjusted expected return. In short, all costs that needs to be paid are paid by the firm but the profit is equal to 0. The movement of money into or out of a business, project, or financial product. It is usually measured during a specified, limited period of time. Measurement of cash flow can be used for calculating other parameters that give information on a company"s value and situation. It is used to: determine a projects rate of return value, determine problems with liquidity, alternative measure of business profits if accrual accounting isn"t ideal, measures quality of income noted by accrual accounting, evaluate risks with financial production.
