Biscuit Company Sells Its Product for $50

question 128

Multiple Choice

Biscuit Company sells its product for $50. In addition, it has a variable cost ratio of 45 percent and total fixed costs of $6,875. What is the break-even point in sales dollars for Biscuit Company?

• A)$2,750
• B)$3,125
• C)$6,875
• D)$12,500

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Definitions:

SEC

The U.S. Securities and Exchange Commission, the federal agency responsible for enforcing federal securities laws and regulating the securities industry.

FASB

stands for the Financial Accounting Standards Board, which is responsible for establishing accounting and financial reporting standards in the United States.

Total Liabilities

The combined debts and obligations that a company owes to outside parties at any given time.

Total Assets

The sum of all assets, both current and noncurrent, owned by an entity, reflecting the total resources at its disposal.