Thomas Company Had the Following Information: What Is the Break-Even

question 40

Multiple Choice

Thomas Company had the following information: What is the break-even point in units using ABC?

• A) 30,000 units
• B) 45,000 units
• C) 15,000 units
• D) 75,000 units

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Definitions:

Expenses

Expenses are the costs incurred during the operation of a business, such as rent, salaries, utilities, and materials, which are subtracted from revenues to determine net income.

Generating Revenue

Generating revenue involves activities and strategies a business employs to sell goods and services to customers, resulting in earnings.

Accrual Basis of Accounting

An accounting method that records revenues and expenses when they are incurred, regardless of when cash transactions occur.

Electricity Invoice

A bill issued by an electricity provider detailing the charges for electric consumption over a specific period.