CAF-5 · Chapter 13 · Question 2 of 10
Which of the following formulas correctly calculates the Break-Even Point in terms of Sales Revenue?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: B) Total Fixed Costs ÷ Contribution to Sales (C/S) Ratio
Explanation
To find the break-even point in units, you divide fixed costs by contribution per unit. To find the break-even point directly in Sales Revenue, you divide the Total Fixed Costs by the C/S Ratio (Contribution / Sales).
More Cost-Volume-Profit (CVP) Analysis MCQs
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