Finance / July 12, 2018 / Parker Hardy
A break-even analysis is a useful tool for determining at what point your company, or a new product or service, will be profitable. Said another way, it’s a financial calculation used to determine the number of products or services you need to sell to at least cover your costs. When you’ve broken even, you are neither losing money nor making money, but all your costs have been covered.
The cost of debt is the cost or the effective rate that a firm incurs on its current debt. Debt forms a part of a firm’s capital structure. Since debt is a deductible expense, the cost of debt is most often calculated as an after-tax cost to make it more comparable to the cost of equity.
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