This quiz works best with JavaScript enabled. Home > Finance > Accounting > Cost Accounting > Break Even Analysis > Break Even Point – Quiz 5 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Break Even Point Quiz 5 (30 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Which line is not drawn on the break-even chart A) Total Revenue Line. B) Fixed Cost Line. C) Total Cost Line. D) Cost of Sales Line. Show Answer Correct Answer: D) Cost of Sales Line. 2. Fixed Costs £ 42 525Variable Costs £ 3 per ItemForecast Output (Sales) 11 262Sales Revenue £ 135 144What is the Break Even? A) 4725. B) 12. C) 5000. D) None of these. Show Answer Correct Answer: A) 4725. 3. If there is a price increase what will happen to the break-even point? A) It falls. B) It rises. C) It stays the same. D) None of above. Show Answer Correct Answer: A) It falls. 4. Breakeven assumes: A) Most output is sold. B) All output is sold. C) Price changes constantly. D) None of above. Show Answer Correct Answer: B) All output is sold. 5. What is the margin of safety? A) The margin between projected units and break even point units. B) The margin between profit and loss. C) The margin between units and sales. D) The margin between each break even point. Show Answer Correct Answer: A) The margin between projected units and break even point units. 6. Total costs divide by output A) Break-even level of output. B) Margin of safety. C) Contribution per unit. D) Average cost. Show Answer Correct Answer: D) Average cost. 7. What measures the amount by which a business's current level of output exceeds the break-even output? A) Margin of safety. B) Break-even analysis. C) Break-even output. D) Unit contribution. Show Answer Correct Answer: A) Margin of safety. 8. When does the break-even point fall? A) When fixed costs rise. B) When depreciation increases. C) When the selling price decreases. D) When fixed cost fall. Show Answer Correct Answer: D) When fixed cost fall. 9. If you increase Total Costs by 10% and increase Sales Revenue by 10% what would happen to the original break even point? A) It would stay the same. B) It would increase. C) It would decrease. D) None of above. Show Answer Correct Answer: A) It would stay the same. 10. Define variable costs. A) Combined costs. B) Overhead costs. C) Costs only related to making the product. D) Costs that include marketing. Show Answer Correct Answer: C) Costs only related to making the product. 11. 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 break-even? A) 570. 63. B) 571. C) 572. D) 571.42. Show Answer Correct Answer: C) 572. 12. A business that does not reach break-even will A) Go bankrupt. B) Have profit and loss. C) Lose money. D) Need to relocate. Show Answer Correct Answer: C) Lose money. 13. Which one is not included in the Break Even formula? A) Selling price per unit. B) Variable costs per unit. C) Cost price per unit. D) Total fixed costs. Show Answer Correct Answer: C) Cost price per unit. 14. Anna runs a photography business. She has the following costsFixed costs = £ 30, 000 A) £ 112 500. B) £ 112 000. C) £ 375. D) £ 800. Show Answer Correct Answer: B) £ 112 000. 15. When costs fall, break even point is lower and profits higher A) False. B) True. C) No effect. D) None of above. Show Answer Correct Answer: B) True. 16. A business can reduce the variable cost by A) Decreasing the fixed cost. B) Changing the location of the business. C) Increasing the fixed cost. D) Finding a new supplier. Show Answer Correct Answer: D) Finding a new supplier. 17. Total cost consist of A) Variable cost + sales cost. B) Fixed cost + sales cost. C) Variable cost + fixed cost. D) Variable cost + future cost. Show Answer Correct Answer: C) Variable cost + fixed cost. 18. Brian and Amy invest $ 2700 to start a hair cutting business. Each hair cut costs them $ 1.50 (supplies). They charge their customer $ 15 for each cut.How many hair cuts until they breakeven? A) 22 hair cuts. B) 15. C) 2700 hair cuts. D) 200 hair cuts. Show Answer Correct Answer: D) 200 hair cuts. 19. Average costs of buying supplies falls as business expands A) Average cost. B) Margin of safety. C) Contribution per unit. D) Purchasing economy of scale. Show Answer Correct Answer: D) Purchasing economy of scale. 20. Frederick is revising his formulae for a test on break-even. He has mixed up his revision notes. What is the formula for Profit? A) Actual output-break-even point. B) Total revenue-total cost. C) Fixed cost + variable cost. D) Total revenue = total cost. Show Answer Correct Answer: B) Total revenue-total cost. 21. Gemima sells dolls houses at $ 50 each. Each dolls house costs her $ 32 to make. Her fixed costs are $ 2700. How many dolls houses must Gemima make in order to break-even? Break-even = fixed cost Selling price per unit-variable cost per unit A) 19. B) 20. C) 150. D) 22. Show Answer Correct Answer: C) 150. 22. Frederick is revising his formulae for a test on break-even. He has mixed up his revision notes. What is the formulas for Total Costs A) Total revenue-total cost. B) Fixed cost + variable cost. C) Actual output-break-even point. D) Total revenue = total cost. Show Answer Correct Answer: B) Fixed cost + variable cost. 23. Which of the following best defines the term variable cost? A cost which: A) Changes with time. B) Are only paid when the business first sets up. C) Changes according to output. D) Stays the same regardless of output. Show Answer Correct Answer: C) Changes according to output. 24. Why is equal to price per unit minus variable cost per unit? A) Margin of safety. B) Break-even analysis. C) Break-even output. D) Unit contribution. Show Answer Correct Answer: D) Unit contribution. 25. At break even, which two lines cross A) Fixed and Total Cost. B) Fixed and Total Revenue. C) Units and Cost. D) Total Revenue and Total Cost. Show Answer Correct Answer: D) Total Revenue and Total Cost. 26. Raw materials cost for a steel manufacturer are an example of its ..... costs A) Fixed. B) Total. C) Average. D) Variable. Show Answer Correct Answer: D) Variable. 27. If the unit contribution is increased then: A) The break-even point is higher. B) The break-even point is lower. C) The break-even point is unchanged. D) None of above. Show Answer Correct Answer: B) The break-even point is lower. 28. The total costs of a business are equal to: A) Quantity of units sold multiplied by the selling price. B) The profit made. C) Quantity of units produced multiplied by average cost of producing each unit. D) Variable costs plus added value. Show Answer Correct Answer: C) Quantity of units produced multiplied by average cost of producing each unit. 29. What is "break-even quantity" ? A) The output at which revenue is equal to costs. B) The output at which revenue is greater than costs. C) The output at which costs is greater than revenue. D) The output at which revenue is less than costs. Show Answer Correct Answer: A) The output at which revenue is equal to costs. 30. Fill in the blank. The name given to the difference between BEP and actual sales above this point is ..... ..... ..... A) Safety zone. B) Margin of safety. C) Sales margin. D) Sales surplus. Show Answer Correct Answer: B) Margin of safety. ← PreviousNext →Related QuizzesCost Accounting QuizzesAccounting QuizzesBreak Even Point Quiz 1Break Even Point Quiz 2Break Even Point Quiz 3Break Even Point Quiz 4Break Even Point Quiz 6Break Even Point Quiz 7 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books