This quiz works best with JavaScript enabled. Home > Accounting > Cost Accounting > Break Even Analysis > Break Even Point – Quiz 2 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Break Even Point Quiz 2 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. 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? A) 220, 360. B) 150, 300. C) 183, 633. D) 225, 120. Show Answer Correct Answer: A) 220, 360. 2. Ingredients are usually a A) Fixed cost. B) Variable cost. C) Selective cost. D) Expensive cost. Show Answer Correct Answer: B) Variable cost. 3. Which of the following calculations would you use to find total costs? A) Fixed Costs + Variable Costs. B) Selling Price-Fixed Costs. C) Total Fixed Costs / Selling Price-Variable Cost. D) Total Fixed Costs/Variable Cost Per Item. Show Answer Correct Answer: A) Fixed Costs + Variable Costs. 4. If there was a fall in fixed costs what impact would this have on the break-even output? A) Smaller output is necessary to break-even. B) Break-even is achieved at a lower level of output. C) Greater output necessary to break-even. D) Break-even is reached at a higher level of output. Show Answer Correct Answer: A) Smaller output is necessary to break-even. 5. The best definition of the contribution made by a product is: A) Profit made on each item sold. B) Revenue gained from selling each item. C) Difference between price and variable cost. D) Difference between price and fixed cost. Show Answer Correct Answer: C) Difference between price and variable cost. 6. Which of these is a risk of ignoring break even analysis? A) It allows the business to set a margin of safety. B) It allows the business to stock profitable goods. C) Costs of stock or materials may be too high and go unnoticed. D) None. Show Answer Correct Answer: C) Costs of stock or materials may be too high and go unnoticed. 7. According to the following data (Selling Price= $ 1000, Variable Cost= $ 268, Fixed Cost= $ 12.000) Calculate the breakeven ***3 minutes to answer*** A) 16.39. B) 16.93. C) 19.36. D) 13.69. Show Answer Correct Answer: A) 16.39. 8. If you have an increase in costs what effect would that have on the break-even point? A) Increase. B) Decrease. C) Stay the same. D) None of above. Show Answer Correct Answer: A) Increase. 9. On a break even chart, where is breakeven? A) Total Revenue = Total Costs. B) Fixed Costs = Total Revenue. C) Total Costs = Fixed Costs. D) Variable Costs = Total Revenue. Show Answer Correct Answer: A) Total Revenue = Total Costs. 10. What assumption does this statement say "Break even is 54 units" ? A) If we sell 55 we aren't making a profit. B) If we sell 54 we begin to make a profit. C) If we sell 55 we begin to make a profit. D) If we sell 54 we are not yet at break even point. Show Answer Correct Answer: C) If we sell 55 we begin to make a profit. 11. At a local ballpark a team charges $ 10 per ticket. The team must pay its players $ 4000. It costs the owners $ 6 for each souvenir they give away.How many tickets must be sold to break even. A) 1000 tickets. B) 10, 000 tickets. C) 600 tickets. D) 660 tickets. Show Answer Correct Answer: A) 1000 tickets. 12. At a local ballpark a team charges $ 10 per ticket. The team must pay its players $ 4000. It costs the owners $ 6 for each souvenir they give away.How much profit will they make if they sell 2, 230 tickets? (income-cost = profit) A) $ 2, 230. B) $ 4, 920. C) $ 1, 000. D) $ 2, 920. Show Answer Correct Answer: B) $ 4, 920. 13. What is the break-even output formula? A) Fixed costs / Contribution per unit. B) Fixed costs / Selling price per unit. C) Contribution per unit/ / Fixed costs. D) Fixed costs / Variable costs per unit. Show Answer Correct Answer: A) Fixed costs / Contribution per unit. 14. Businesses calculate break-even in dollars so they know the A) Amount of the business's after tax-earnings. B) Total dollar value of the stock on hand. C) Total dollar sales needed to reach break-even. D) Amount the business can spend on new purchases. Show Answer Correct Answer: C) Total dollar sales needed to reach break-even. 15. The break even level of output for a firm is 800 units and it is currently making 950 units. What is its margin of safety? A) 150 units. B) 250 units. C) 300 units. D) 1750 units. Show Answer Correct Answer: A) 150 units. 16. Margin of safety is? A) Actual sales-break-even sales. B) Fixed costs-selling price. C) Actual sales + break-even sales. D) Actual sales-Fixed costs. Show Answer Correct Answer: A) Actual sales-break-even sales. 17. If the average variable costs £ 10, average selling price is £ 25 and fixed costs are £ 60, 000, then what is the break-even output? A) 5000. B) 7000. C) 6000. D) 4000. Show Answer Correct Answer: D) 4000. 18. Define mark up A) Profit. B) The cost price. C) The selling price. D) The added cost to cost price. Show Answer Correct Answer: D) The added cost to cost price. 19. How do you calculate the opening balance? A) Net cash flow-closing balance. B) Closing balance from the previous month. C) Total receipts-Total Payments. D) Net Cash flow + closing balance. Show Answer Correct Answer: B) Closing balance from the previous month. 20. What is one limitation to calculating break even? A) Helps projected sales. B) Based on estimates. C) Based on multiple products. D) Considers stock wastage. Show Answer Correct Answer: B) Based on estimates. ← PreviousNext →Related QuizzesCost Accounting QuizzesAccounting QuizzesBreak Even Point Quiz 1Break Even Point Quiz 3Break Even Point Quiz 4Break Even Point Quiz 5Break Even Point Quiz 6Break Even Point Quiz 7Break Even Point Quiz 8Break Even Point Quiz 9 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books