Which of the following formulas is used to calculate break-even units? Fixed Costs ÷ Unit Contribution Margin Variable Costs ÷ Contribution Margin Percent Variable Costs ÷ Unit Contribution Margin Fixed Costs ÷ Contribution Margin Percent

Principles of Accounting Volume 2
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Chapter10: Short-term Decision Making
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1.  Which of the following formulas is used to calculate break-even units?

  1. Fixed Costs ÷ Unit Contribution Margin
  2. Variable Costs ÷ Contribution Margin Percent
  3. Variable Costs ÷ Unit Contribution Margin
  4. Fixed Costs ÷ Contribution Margin Percent

 

 

2.  What effect does the increase in fixed costs have on the break-even units?

  1. Decrease
  2. Increase
  3. No-effect
  4. None of these choices are correct.

 

 

3.  If a company decides to increase the selling price of its product, what is its effect on break-even point?

  1. Decrease
  2. Increase
  3. No-effect
  4. None of these choices are correct.

 

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