When there is an increase in customer sales, it means that there is higher demand. A company then needs to produce more of its products to meet this new demand which, in turn, raises the BEP in order to cover the extra expenses.
If variable costs per unit increase, then the breakeven point will decrease.
If variable costs per unit increase, then the breakeven point will also increase.
The break-even point is where total sales revenue equals total cost. If fixed costs increase, the break-even point decreases.
As a simple mathematical identity, raising prices increases contribution per unit, which lowers the number of units required to break even.
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