Note 2-29

(29) The break-even point is the sales level at which an enterprise becomes profitable. An enterprise can make it easier for profit to emerge by cutting the ratio of fixed costs (personnel cost + interest cost and discount charge + depreciation cost) to marginal profit (fixed costs + profit) to lower the break-even point. Therefore, a fall in the break-even point reflects enterprise restructuring efforts. On the other hand, the break-even point ratio is the ratio of break-even point sales to actual sales, reflecting both restructuring efforts and actual sales.