2 INCREMENTAL ANALYSIS FOCUSES ON THE THE EQUATION METHOD USES SOME...

6-2 Incremental analysis focuses on the

The equation method uses some varia-

changes in revenues and costs that will result

tion of the equation Sales = Variable expenses

+ Fixed expenses + Profits, where profits are

from a particular action.

zero at the break-even point. The equation is

solved to determine the break-even point in