Break Even
14 minutes ago
alan_issott_50733
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20 QuestionsShow answers
  • Question 1
    30 seconds
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    Q. What does break even point show?
    answer choices
    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
  • Question 2
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    Q.

    What assumption does this statement say "Break even is 54 units"?

    answer choices

    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

  • Question 3
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    Q. What is the margin of safety?
    answer choices
    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
  • Question 4
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    Q.

    What is the formula for contribution?

    answer choices

    cost price - selling price

    fixed costs - variable costs

    selling price - variable cost

    selling price - cost price

  • Question 5
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    Q. What is one limitation to calculating break even?
    answer choices
    helps projected sales
    based on estimates
    based on multiple products
    considers stock wastage
  • Question 6
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    Q. To draw the BE graph you must plot Total Costs and ........
    answer choices
    Total Production
    Total Revenue
    Total Fixed Costs
    Total Units
  • Question 7
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    Q. 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? 
    answer choices
    £300
    £500
    £200
    Cannot be calculated
  • Question 8
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    Q.

    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?

    answer choices

    £112 000

    £112 500

    £375

    £800

  • Question 9
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    Q.

    Simon 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?

    answer choices

    66 000

    74 000

    200 000

    174 000

  • Question 10
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    Q. Some business costs are classified as fixed costs because they
    answer choices
    must be paid within a set time
    don't change when sales go up or down
    are unpredictable and must be estimated
    cost all businesses the same amount
  • Question 11
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    Q. If a business's sales double, its variable costs will also likely
    answer choices
    remain the same
    decrease
    increase
    double
  • Question 12
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    Q. Most businesses receive the bulk of their income from
    answer choices
    dividends
    sales revenue
    return on investment
    capital
  • Question 13
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    Q. One of the main purposes for calculating break-even is to help the business to
    answer choices
    determine stock value
    prepare an income statement
    forecast sales
    set selling prices
  • Question 14
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    Q. Businesses calculate break-even in units so they know
    answer choices
    how much profit they will earn after they break even
    which products they should purchase for resale
    which costs are variable and which are fixed
    how many products they must sell to break even
  • Question 15
    20 seconds
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    Q.

    Which one of the following would be included in the calculation of total costs?

    answer choices

    Selling price

    Rent of premises

    Revenue

    Refund to a customer

  • Question 16
    120 seconds
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    Q.

    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

    answer choices

    150

    22

    19

    20

  • Question 17
    60 seconds
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    Q.

    Gemima's dolls houses are very popular, she is considering setting her selling price to £55. If she does this what would happen to her break-even point?

    answer choices

    Would increase

    Would decrease

    Would stay the same

  • Question 18
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    Q.

    Bart 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.

    answer choices

    1

    2

    3

    4

  • Question 19
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    Q.

    Bart 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?

    answer choices

    250

    1450

    150

    50

  • Question 20
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    Q.

    Frederick is revising his formulae for a test on break-even. He has mixed up his revision notes. What is the formulas for Profit

    answer choices

    Total revenue - total cost

    Fixed cost + variable cost

    Actual output - break-even point

    Total revenue = total cost

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