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A cone of depression can form if:
Net Operating Income
Net Operating Income is a measure of a company's profitability from its regular business operations, excluding income and expenses from interest, taxes, and other non-operational activities.
Fixed Manufacturing Overhead
Regular, constant expenses related to the production process that are not affected by the level of goods produced, such as rent and salaries of management.
Ending Inventory
The total value of all inventory that a company still has on hand at the end of a reporting period.
Break-Even
The point at which total costs and total revenue are equal, resulting in no net loss or gain for a business.
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