In a Cost-Volume-Profit Graph the Break-Even Point Will Be Found

question 5

Multiple Choice

In a cost-volume-profit graph the break-even point will be found:

• A)Where the predetermined overhead rate equals the contribution margin rate
• B)At the point where total income equals total fixed costs
• C)At the point where total income equals total fixed plus total variable costs
• D)Where the total income line crosses the fixed costs line

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Definitions:

Interest Note

A financial instrument that serves as a formal promise to pay interest in addition to the principal amount borrowed.

Small Companies

Businesses with a relatively small market share or workforce, often defined by specific criteria such as revenue, assets, or number of employees.

Receivables

Money owed to a company by its customers or clients for goods or services that have been delivered but not yet paid for.

Direct Write-off Method

An accounting method where uncollectible accounts receivable are directly written off against income at the time they are considered unrecoverable.