Article Critique

409 WordsMar 2, 20142 Pages
The article in which I have chosen is titled Using Break-even Analysis in Business Decisions, by John Foltz and Dr. Christine Wilson. The authors are attempting to show how conducting a break-even analysis could provide a better way to look at revenues. They begin the article by using a feed and grain business as an example. The authors use sample estimates for the business to show the break-even point and the equation used to determine it. They then move on to discuss including a profit goal into the break-even analysis and how to incorporate that goal. They use the sample estimates from earlier to show how it works. The authors then discuss a sensitivity analysis for the business to be able to view different scenarios of possibilities. They also provide a table of how the sensitivity analysis works with different scenarios. To conclude the article, the authors indicate that the business should now be able to uses the break-even analysis in helping to “understand and examine the profit drivers of the business” (John Foltz, 2013). They also explain again the usefulness of this analysis, what the business needs to begin, and offers suggestions to help the business get started with the break-even analysis. Although the author’s intent is to explain break-even analysis and to use it in business, I feel that the article itself could have been more detailed in its explanation and possibly more descriptive with the examples used. I also feel that the authors could be gone a little more textbook style with their examples by working the problems out in full step by step equations instead of just written out in a paragraph. All in all, the article was informative just has a lack of definition to it. 1. I liked how the authors attempt to explain break-even analysis to the business, although I feel it could still be confusing for the business to grasp the concept. 2. I

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