Breakeven sales volume is calculated as:
A) Breakeven point (in units) = Total Fixed Costs/Contribution Margin
B) Breakeven point (in units) = Total Variable Costs/Contribution Margin
C) Breakeven point (in units) = Total Costs/Contribution Margin
D) Breakeven point (in units) = Total Costs/Selling Price

Question

Quizplus · Accepted Answer

Breakeven point (in units) is calculated as Total Fixed Costs divided by the Contribution Margin per unit. The Contribution Margin is the selling price per unit minus the variable cost per unit. This formula helps businesses determine the number of units they need to sell to cover all fixed costs.

Breakeven Sales Volume Is Calculated As