1. It helps in setting profit goal and sales target.
2. In a manufacturing environment, it helps in determining the products that are not contributing to meet the fixed expenses and thus brings up the item for discussion in management meetings about its continuity.
3. Breakeven point is the level of sales (or revenue generated) that equals all the expenses required for generating that revenue. There is neither loss nor profit. It helps the organisation to determine the level when will it turn profitable.