Santos, Kiesha Renee B.

EECO101-C36
1. Why is Break Even Analysis important?

Breakeven is important for the business owners because in this way, they
will determine the charges for its products and the services will cover it costs
to make the products or provide services.

The process of determining the breakeven point is a good time for

businesses to assess their true cost of doing business and their prices.
Many start-ups don't understand their direct and indirect costs very well.
Working on a breakeven analysis will help business owners and managers
learn these figures and gain better insight into the accuracy of their prices
and how realistic their sales goals are.

2. A manufacturer produces certain items at a labor cost of P 115 each, material

cost of P 76 each and variable cost of P 2.32 each. If the item has a unit price of
P 600, how many units must be manufactured each month for the manufacturer
to break even if the monthly overhead is P428,000

x= units manufactured per month

income = expenses
P600x = P115x + P76x +P2.32x + P428,000
P406.68x = P428,000

x = 1,052 units

3. Compare and contrast Simple Interest vs. Compounded Interest

Compound interest is often a factor in business transactions, investments

and financial products intended to extend for multiple periods or years
while Simple interest is mainly used for easy calculations: those generally
for a single period or less than a year, though they also apply to open-
ended situations like credited card balance.

4. In your own words, provide a comprehensive reflection on what you have learned
for the past 2 meetings and where can you apply them?

I learned about the different types of cost and how to apply them in real life
situations and I can be able to use that when I want to make a business.
Also, I learned about when I will have to start creating a profit with a use of
applying Break Even Point. I was also doing a self-analysis on how to not
to lose money when making having business.