A break-even analysis is a financial tool that helps a company determine the point at which the business, or a new service or product, will be profitable. In other words, it is a financial calculation to determine the number of products or services that a company must sell or provide to cover its costs (including fixed costs).
When a company's numbers fluctuate or drop, it's time to act, right? Otherwise it will be almost impossible for your business to be sustainable. Therefore, it is not surprising that a financial adviser is of an unprecedented necessity. Looking for solutions to the economic and financial problems of your business will “save your life”. You should know that financial advice is the flagship of other money-related services, like banking, insurance, retail management, and entrepreneurship in general.
Financial analysts play a vital role in the day-to-day operations of an organization. At a high level, they research and use financial data to understand the business and the market to see how an organization is doing. Based on general economic conditions and internal data, they recommend actions for the company, such as selling stock or making other investments.
The purpose of a financial analysis of the company is to answer questions relating to decision-making. A common distinction is made between internal and external financial analysis. Internal analysis is done by an employee of the company while external analysis is done by independent analysts. Whether it is carried out internally or by an independent, it must follow five (05) steps.