Which of the Following Is TRUE When Using the Income

question 111

Multiple Choice

Which of the following is TRUE when using the income statement approach to finding break-even?

• A) Sales revenue - variable expenses - fixed expenses = operating income
• B) (Variable expenses × number of units) - fixed expenses = operating income
• C) Fixed expenses + variable expenses + sales revenue = operating income
• D) Fixed expenses + variable expenses - sales revenue = operating income

---

Definitions:

Impose a Tax

The act of a governing body levying a financial charge or other levy upon a taxpayer, which can affect individuals, entities, or transactions.

Efficient Amount

The optimal level of production or consumption where resources are utilized in the most effective manner without waste.

External Cost

A cost of economic activity not borne by the producer or consumer, but rather by a third party or the environment, often leading to market failure.

Efficient Amount

The quantity of a product or service that achieves a perfect balance between economic efficiency and the satisfaction of all market participants.