Break-Even Ratio (BER)

Investor Term: 

BER

Definition: 

The break-even ratio is a financial ratio that measures the percentage of gross revenue required to cover all operating expenses. It is calculated by dividing the total operating expenses by the gross revenue.

Formula: 

BER  = Total Operating Expenses / Gross Revenue

EXAMPLE 

For example, if a business has $100,000 in total operating expenses and $200,000 in gross revenue, its break-even ratio would be 50%.