Break Even Word Problems

Which one is not included in the Break Even formula?

• variable costs per unit
• total fixed costs
• selling price per unit
• cost price per unit

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

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 not yet at break even point

What is the margin of safety?

• the margin between projected units and break even point units
• the margin between profit and loss
• the margin between units and sales
• the margin between each break even point

What is the formula for contribution?

• cost price - selling price

• fixed costs - variable costs

• selling price - variable cost

• selling price - cost price

What is one limitation to calculating break even?

• helps projected sales
• based on estimates
• based on multiple products
• considers stock wastage

To draw the BE graph you must plot Total Costs and ........

• Total Production
• Total Revenue
• Total Fixed Costs
• Total Units

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

My total costs are £50,000 when selling 100 items. My fixed costs are £20,000. What must be the variable cost of one item? 

• £300
• £500
• £200
• Cannot be calculated

We are going to manufacture Whats-Its. The Whats-It machine costs £4000.It also costs £5 for materials and labour for each Whats-It. We are planning to sell our Whats-Its for £12 each. How many Whats-Its must we sell in order to breakeven?

• 571.42

• 572

• 570. 63

• 571