Lightfoot Company Sells Its Product for $55 and Has Variable

question 46

Multiple Choice

Lightfoot Company sells its product for $55 and has variable costs of $30 per unit. Total fixed costs are $25,000. What will be the effect on the breakeven point if variable costs increase by 10% due to an increase in the cost of direct materials?

• A) It will increase by approximately 136 units.
• B) It will increase by approximately 242 units.
• C) It will decrease by approximately 136 units.
• D) It will decrease by approximately 242 units.

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Definitions:

Heritable

Traits or characteristics that can be passed from parents to offspring through genes.

Viability

The ability of an organism to survive, grow, and develop in its environment.

Produce Offspring

The biological process through which organisms generate new individuals of the same species, contributing to the continuation of the species.

Grants

Financial funds provided by an organization, often a government agency, foundation, or trust, to support a project or research.