Currently, Fixed Costs Are $561,000 and the Unit Contribution Margin

question 76

Multiple Choice

Currently, fixed costs are $561,000 and the unit contribution margin is $10.What would be the break-even point in units if variable cost is decreased by $0.50 per unit?

• A) 59,053 units
• B) 56,100 units
• C) 53,429 units
• D) 60,000 units

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Definitions:

Model

A simplified representation, often mathematical, of a system or process used to analyze behavior, make predictions, or inform decision-making.

Waste Elimination

The process of identifying and removing unnecessary elements from processes or products to improve efficiency and reduce costs.

Variable Cost

Expenses that change in proportion to the activity of a business, such as costs for raw materials or production inputs.

Experiment

A scientific procedure undertaken to test a hypothesis, discover unknown effects, or demonstrate a known fact, usually under controlled conditions.