Answer: See explanation
Step-by-step explanation:
Break-even analysis tells a business about the number of products which must be sold in order to cover the costs of production.
Advantages of break even analysis include:
1. It enables a business organization to be able to measure the profit and the losses at different stages of the production and sales.
2. It is used to forecast the effect of the changes in the sales prices.
3. It also vital in analyzing the relationship that exist between the fixed cost and the variable costs.
Disadvantages of break even analysis include:
1. It assumes that the sales prices are constant at the levels of output.
2. It also assumes that both the sales and the production are the same.
3. It can be time consuming during its preparation.