Nickleby sells its single product for $14 per unit, and its variable cost per unit is $4. Total fixed costs are $800. Its CVP graph is as follows: If Nickleby increases its sales volume by 20%, what will happen to its breakeven point?
A) It will decrease.
B) It will increase.
C) It will stay the same.
D) Cannot be determined.

Question

Nickleby sells its single product for $14 per unit, and its variable cost per unit is $4. Total fixed costs are $800. Its CVP graph is as follows:  If Nickleby increases its sales volume by 20%, what will happen to its breakeven point?
A) It will decrease. 
B) It will increase. 
C) It will stay the same. 
D) Cannot be determined.

Quizplus · Accepted Answer

The Answer of Nickleby sells its single product for $14 per unit, and its variable cost per unit is $4. Total fixed costs are $800. Its CVP graph is as follows:  If Nickleby increases its sales volume by 20%, what will happen to its breakeven point?
A) It will decrease. 
B) It will increase. 
C) It will stay the same. 
D) Cannot be determined.

Nickleby Sells Its Single Product for $14 Per Unit, and Its