Bloom Company Has Variable Cost Per Unit of $20 and a Sales

question 31

Multiple Choice

Bloom Company has variable cost per unit of $20 and a sales price of $35 per unit.Its total fixed costs are $240,000.Which of the following is a correct statement?

• A) Company D's break-even point is 12,000 units.
• B) If budgeted sales are 25,000 units, D's margin of safety is 10,000 units.
• C) If Company D's variable cost per unit increases and nothing else changes, the margin of safety will decrease.
• D) If Company D's variable cost per unit decreases and nothing else changes, the break-even point will stay the same.

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