Breakeven is the point at which total revenues equal total costs, meaning there is no profit or loss. It helps businesses determine how much they need to sell to cover their expenses. Understanding the breakeven point is crucial for making informed financial decisions and setting sales targets. To calculate the breakeven point, businesses often use the formula: Fixed Costs divided by the difference between Selling Price per unit and Variable Costs per unit. This analysis allows companies to assess their financial health and plan for future growth effectively.