As sales volume in units increases and all other relationships remain constant
A) break-even increases.
B) break-even decreases.
C) total contribution margin decreases.
D) total contribution margin increases.

Question

Quizplus · Accepted Answer

As sales volume in units increases, total contribution margin increases. This is because when sales increase, the revenue generated from sales also increases, which can help to offset fixed costs and lead to a higher total contribution margin. Therefore, options A and C can be eliminated. Option B is incorrect because as sales increase, the break-even point may decrease, depending on the size of the increase in sales volume and the impact on fixed costs.

As Sales Volume in Units Increases and All Other Relationships