Break-even time: Break-even time can be defined as the total time required to earn total revenue which equals the total costs such that there is neither income nor loss respectively. Payback period: Payback period can be defined as the number of time periods required to earn or payback the initial investment cost for the project. To explain: To explain the advantages of break-even time over the payback period.

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Chapter 11, Problem 15DQ

To determine

Concept introduction:

Break-even time:

Break-even time can be defined as the total time required to earn total revenue which equals the total costs such that there is neither income nor loss respectively.

Payback period:

Payback period can be defined as the number of time periods required to earn or payback the initial investment cost for the project.

To explain:

To explain the advantages of break-even time over the payback period.

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