AS Business Break Even and Costing Revision Questions

When a business has made enough money to pay its costs and begin to make a profit, it has reached its

• break-even point
• variable-cost margin
• fixed cost
• selling price

Some business costs are classified as fixed costs because they

• must be paid within a set time
• don't change when sales go up or down
• are unpredictable and must be estimated
• cost all businesses the same amount

If a business's sales double, its variable costs will also likely

• remain the same
• decrease
• increase
• double

A business that does not reach break-even will

• go bankrupt
• have profit and loss
• lose money
• need to relocate

What is the break-even point in units for a company whose total fixed costs are $275,450; selling price per unit is $16; and variable cost per unit is $14.75?

• 220,360
• 150,300
• 183,633
• 225,120

What does break even point show?

• where a business is neither making a profit or loss
• how many items to make
• how much profit they're making
• where a business has more fixed costs than variable

How is break even point measures?

• dollars
• loss
• profit
• items

What assumption does this statement say "Break even is 54 units"?

• if we sell 55 we aren't making a profit

• if we sell 54 we begin to make a profit

• if we sell 55 we begin to make a profit

• if we sell 54 we are losing money

Define variable costs.

• costs only related to making the product
• overhead costs
• combined costs
• costs that include marketing

Daisy is an artist. It costs her $150 per week to operate her art studio. In this case, what is the $150?

• the break-even point

• the fixed cost

• the variable cost

• the sales revenue