To Obtain the Break-Even Point in Terms of Dollar Sales

question 140

Multiple Choice

To obtain the break-even point in terms of dollar sales, total fixed expenses are divided by which of the following?

• A) Variable expense per unit.
• B) Variable expense per unit/Selling price per unit.
• C) Fixed expense per unit.
• D) (Selling price per unit - Variable expense per unit)/Selling price per unit.

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Definitions:

Cash Sales

Revenue received from transactions where payment is made immediately in cash.

Collections

The process of pursuing and receiving payments on outstanding accounts receivable from customers.

Payments

The act of transferring money or money's worth from one party to another as a settlement for a transaction or an obligation.

Cash Receipts

Money received by a business, recorded in its financial statements, typically from transactions such as sales or services rendered.