Scenario 19

question 103

Multiple Choice

Scenario 19.1 Use the following to answer the questions.
Concession Supply sells hotdogs, buns, and nacho ingredients to several major league ballparks across the country. Currently, Concession Supply has the following pricing information for one case of hotdogs sold at Wrigley Field: Total fixed costs = $1,200, Selling price = $16, and Variable costs = $6.
Refer to Scenario 19.1. What is the breakeven point in dollar sales volume?

• A) $1,200
• B) $1,440
• C) $3,000
• D) $1,920
• E) $1,600

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Definitions:

Revenues

The overall income earned from transactions of goods or services central to a business's core functions.

Operating Revenues

The income earned from a company's main business operations, excluding income from investments or secondary sources.

Operating Expenses

The costs associated with the normal operations of a business, excluding costs related to producing goods or services, like rent, utilities, and salaries.

Interest Expense

The cost incurred by a company for borrowed funds, shown as an expense on the income statement.