Which of the Following Conditions Would Cause the Break-Even Point

question 156

Multiple Choice

Which of the following conditions would cause the break-even point to increase?

• A) Total fixed costs increase
• B) Unit selling price increases
• C) Unit variable cost decreases
• D) Total fixed costs decrease

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Definitions:

Break-even Point

The production level or sales volume at which total costs equal total revenue, resulting in no profit or loss.

Sales Mix

The combination of different products or services that a company sells, significantly influencing overall profitability.

Fixed Costs

Overheads such as rent, salaries, and insurance that do not fluctuate with changes in the volume of production or sales.

Break-even Point

The level of sales at which total revenues equal total costs, resulting in no profit or loss and marking the threshold for profitability.