➡️QUESTION⬅️


When a company had sales revenue of $600 000, its variable costs were $300 000.

At the break-even point, its sales were $400 000.

How much profit did it make when sales were $600 000?

A $100000
B $200000
C $300000
D $400000

ANSWER A


➡️QUESTION⬅️


A business has total fixed costs of $240000. Products have a unit selling price of $25 and a unit
variable cost of $15.

How many units need to be sold to break even?

A 6000
B 9600
C 16000
D 24000

ANSWER D



➡️QUESTION⬅️


Which statements identify a disadvantage of break-even analysis?

1 It does not show the effect of changes in output on the break-even point.

2 It is assumed that all costs can be split between fixed and variable.

3 It makes it difficult to decide the profitability of a product at different levels of activity.

A 1and2
B 2and3
C 2only
D 3only


ANSWER D


➡️QUESTION⬅️


How is the margin of safety calculated?

A actual contribution less budgeted contribution
B actual profit less budgeted profit
C budgeted contribution less break-even point
D budgeted sales less break-even point

ANSWER D



➡️QUESTION⬅️


A product has a variable cost of $31.32 per unit. Total fixed costs are $93 600.

When production is 13000 units the margin of safety is 5000 units.

What is the selling price per unit?

A $36.52
B $38.52
C $43.02
D $50.04


ANSWER C