In Its First Year, Joe's Startup Company Had Revenues of $125,000

question 52

Multiple Choice

In its first year, Joe's Startup Company had revenues of $125,000 and cost of goods sold of $81,250, which was the only variable cost. Depreciation was $20,000. Cash fixed costs were $100,000, consisting of $5,000 in financing costs, $50,000 in administrative expenses, and $45,000 in marketing expenses. What is the survival breakeven revenues?

• A)$342,857
• B)$285,714
• C)$271,429
• D)$184,615

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Definitions:

Metabolic Rate

The rate at which the body uses energy while at rest to maintain vital functions such as breathing and keeping warm.

Meningitis

An inflammation of the protective membranes covering the brain and spinal cord, potentially leading to serious health issues.

Hyperventilating

Breathing at an abnormally rapid rate, leading to a decrease in carbon dioxide levels in the blood.

Ventilation

The process of providing fresh air to a space or the exchange of air to remove stale air, crucial for maintaining healthy indoor environments.