Answer the Following Questions Using the Information Below

question 64

Multiple Choice

Answer the following questions using the information below:
Sherry's Custom Jewelry sells a single product. 700 units were sold resulting in $7,000 of sales revenue, $2,800 of variable costs, and $1,200 of fixed costs.
-Breakeven point in units is:

• A)200 units
• B)300 units
• C)500 units
• D)None of these answers are correct.

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Definitions:

Capital Investment Evaluation Methods

Techniques used to assess the value and potential return of investments a business makes in long-term assets, including net present value, return on investment, and payback period analysis.

Average Rate of Return on Investment

A financial metric that compares the amount of profit expected or gained from an investment relative to its cost.

Net Present Value

A method used in capital budgeting to evaluate the profitability of an investment, calculated as the difference between the present value of cash inflows and the present value of cash outflows over a period of time.

Estimated Net Income

A projection of a company’s net income, considering potential revenues and expenses, for a future period.