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WorksheetsBreak Even
Total questions: 25
Worksheet time: 16mins
What is the formula for Revenue?
Price x Quantity sold
Fixed costs + Variable costs
Costs x Quantity
Income stream
Which of the following is an example of a fixed cost for a cafe?
Managers' salaries
Workers' wages
Coffee
Cakes
What is the formula for Total Costs?
Variable costs - Fixed costs
Variable costs + Fixed costs
Selling price + Fixed costs
Variable costs X Fixed costs
What does break-even point show?
Where a business is neither making a profit or loss
How many items to make in order to make a loss
How much profit the business making
Where a business has more fixed costs than variable costs
The break-even formula is
Fixed costs / (variable costs - total costs)
Fixed costs / (selling price - variable costs)
Contribution / by fixed costs
Fixed costs - revenue
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
If there is an increase in costs what will happen to the break-even point and profits?
Break-even point rises, profits rise
Break-even point rises, profits fall
Break-even point falls, profits rise
Break-even point falls, profits fall
If there is a price increase what will happen to the break-even point?
It falls
It rises
It stays the same
What is the formula for contribution?
cost price - selling price per unit
fixed costs - variable costs
selling price - variable cost per unit
selling price - cost price per unit
Total contribution = ?
Total sales revenue less total variable costs
Total sales revenue less fixed costs
Variable costs per unit less fixed costs
Total selling price less fixed costs.
Margin of safety is?
Actual sales - break-even sales
Fixed costs - selling price
Actual sales + break-even sales
Actual sales - Fixed costs
What is meant if we say "break-even is 54 units"?
If we sell 55 units we aren't making a profit
If we sell 54 units we begin to make a profit
If we sell 55 units we begin to make a profit
If we sell 54 units we are not yet at break-even point
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
£220,360
Mymy's total costs are £50,000 when selling 100 items. Mymy's fixed costs are £20,000. What must be the variable cost of one item?
£300
£500
£200
Cannot be calculated
Fixed costs: = £30,000
Variable cost: = £200 per photo shoot
Forecast output (Sales): = 140 photo shoots
Selling price: = £1000 per photo shoot
What is the Total Contribution?
£112 000
£112 500
£375
£800
Dexter has worked out the following figures for new Bobble Hats he is going to sell. He estimates that he can produce 20 000 hats a month with a selling price of £3.50. He expects the machinery costs to be £60 000 per annum, staff salaries are £72 000 per annum and raw materials cost £30 000 per month.
What is the margin of safety?
66 000
74 000
200 000
174 000
Brandon's Burgers has sales of 250 units, a sales revenue of £26 500, total variable costs of £12 340 and total fixed costs of £4 600 (all annual figures).
Calculate the Total Contribution
£56.64
£14 160
£14 410
£566.40
Brandon's Burgers has sales of 250 units, a sales revenue of £26 500, total variable costs of £12 340 and total fixed costs of £4 600 (all annual figures).
Calculate the Contribution per unit
£56.64
£14 160
£14 410
£566.40
Brandon's Burgers has sales of 250 units, a sales revenue of £26 500, total variable costs of £12 340 and total fixed costs of £4 600 (all annual figures).
Calculate the Profit or Loss
£9 560
£95 600
£662 5000
£660 8060
Madi is starting a new business making pies. She needs to work out how many pies she needs to sell to break even. Madi plans the pies for £1.25 each. The ingredients and packaging costs 50p and her fixed costs are £1,524 per month. How many units would Madi need to sell to break-even?
75 pies
2032 pies
£75
£2032
Rowyn is planning on opening an ice cream parlour. After carrying out some research a friend has presented him with a break-even chart but he is unsure of what it means. He has asked you to show him where the break-even point is. It is at...
1
2
3
4
Rowyn should break-even at 600 ice creams per month. He believes that he can sell 850 ice creams per month. What is his margin of safety?
250
1450
150
50
What is one limitation to calculating break-even?
Helps projected sales
Based on estimates
Based on multiple products
Considers stock wastage
Which of the following is a limitation of using break-even analysis?
The business may change its selling price
The product may become more fashionable
Takes no account of the credit crunch
A new market entrant will affect the level of demand
