The Level of Sales at Which Revenues Equal Expenses and Net

question 80

Multiple Choice

The level of sales at which revenues equal expenses and net income is zero is called the:

• A) break- even point
• B) margin of safety
• C) marginal income point
• D) contribution margin

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Definitions:

Adjustments Column

A column in journals or ledgers where adjustments are made to correct or update account balances before the preparation of financial statements.

Unadjusted

Refers to figures or entries that have not been modified to reflect adjustments, corrections, or changes.

Adjusted

Adjusted generally refers to alterations made to financial statements or data to correct for discrepancies or to account for extraordinary events.

Final Trial Balances

Final trial balances are the summary listings of all the ledger accounts right after the closing entries are made at the end of an accounting period, essentially reflecting the balance of every account before the start of a new accounting period.