Break-Even Time May Be Defined As

question 88

Multiple Choice

Break-even time may be defined as:

• A) the time from commencement of production of a new product to the point where sufficient profit has been generated to repay the original investment.
• B) the time from the original concept to the point where sufficient profit has been generated to repay the original investment.
• C) the time from the first delivery to a customer of a new product to the point where sufficient profit has been generated to repay the original investment.
• D) None of the given answers

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Definitions:

Cash Only Credit Policy

A credit policy where a company does not extend credit and only accepts cash payments.

Net 30 Policy

A payment term used in business transactions that requires payment to be made in full within 30 days of the invoice date.

Average Collection Period

The average number of days it takes for a company to receive payments owed by its customers.