but it requires a reduction of one-quarter of the fixed costs. Antoinette believes it will be very difficult to reduce fixed costs that much. Perhaps a combination of fixed cost reduction and sales increase will improve the profits enough and still be possible. Before she thinks about that option, though, she completes the break-even forecast analysis by seeing what will happen if she can increase the average gross profit to 50% while leaving the sales revenue and the fixed costs the same. She doesnt know if she can really do it, but wants to see what will happen to the numbers.           Break-Even Sales Revenue Forecast for Antoinettes Dress Shop     Revision 3:   Increase Gross Margin to 50%     Annual sales $400,000     Annual fixed costs 192,600     Gross profit 0.5     Break-even sales   ($192,600 divided by 0.5) 385,200     Sales over break-even   ($400,000 minus 385,200) $14,800     Profit ($14,800 x 0.5) $ 7,400             It seems that Antoinette needs to find some combination of higher sales estimates, lower fixed costs and higher gross profit margin that will improve profits so that she can make a living wage. But the really critical part is this: She must be absolutely sure that she can meet all the forecast changes she makes.     Antoinette was sure of her first forecasts; unfortunately, those forecasts produced a loss for the first year of business. Now, while she can manipulate the numbers to show a profit, the danger is that the numbers may not be achievable. She may be able to create a good-looking business plan but may be unable to meet those revised projections. Or, just as dangerous, she may become uneasy about the projects success. A lack of confidence may just be enough to take the edge off her drive and dedication and enough to make the project fail.