Accounting break-even is the point at which a company’s total revenues equal its total expenses. At this point, the company has no income or loss and has reached a balance. Accounting break-even is an important performance metric for businesses to measure their profitability over a specific period of time. In order to reach accounting break-even, a business must have sales that exceed their fixed expenses, such as rent and salaries. When the company generates enough sales to cover these costs, then it is considered to be at break-even. Knowing when one reaches accounting break-even helps to identify areas of improvement or adjust spending in order to maximize profits or minimize losses.