## What does BEP mean? What is the full form of BEP?

The Full Form of BEP is‍ Break-Even Point.

In accounting, the break-even point formula is determined by dividing the total fixed costs associated with production by the revenue per individual unit minus the variable costs per unit. In this case, fixed costs refer to those which do not change depending upon the number of units sold. Put differently, the breakeven point is the production level at which total revenues for a product equal total expenses.

The term is also used in investing. The breakeven point formula for a stock or futures trade is determined by comparing the market price of an asset to the original cost; the break even point is reached when the two prices are equal. For options trading, the breakeven point is the market price that an underlying asset must reach for an option buyer to avoid a loss if they exercise the option. For a call buyer, the breakeven point is reached when the underlying is equal to the strike price plus the premium paid, while the BEP for a put position is reached when the underlying is equal to the strike price minus the premium paid. The breakeven point doesn’t typically factor in commission costs, although these fees could be included if desired.

### KEY TAKEAWAYS

• In accounting, the breakeven point is calculated by dividing the fixed costs of production by the price per unit minus the variable costs of production.
• The breakeven point is the level of production at which the costs of production equal the revenues for a product.
• In investing, the breakeven point is said to be achieved when the market price of an asset is the same as its original cost.

BEP

means

Break-Even Point

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