The Break-Even Point Is Estimated by

question 1

Multiple Choice

The break-even point is estimated by

• A)multiplying revenue per unit times the quantity sold.
• B)dividing fixed contribution per unit by variable costs.
• C)multiplying fixed costs by contribution per unit.
• D)dividing fixed costs by contribution per unit.
• E)dividing variable costs by fixed costs.

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Definitions:

After-Tax Cost

The expense of an action or investment after accounting for the effects of taxes.

Leverage

The use of borrowed funds to increase the potential return of an investment or project.

ROE

Return on Equity evaluates a company's profit generation capacity by showing the amount of profit made from the investment of its shareholders.

EPS

Earnings Per Share, a key financial metric calculating the portion of a company's profit allocated to each outstanding share of common stock.