If variable costs per unit increased because of an increase in hourly wage rates, the break-even point would
A) decrease
B) increase
C) remain the same
D) increase or decrease, depending on the percentage increase in wage rates

Question

Quizplus · Accepted Answer

An increase in hourly wage rates results in an increase in variable costs per unit since it directly affects the cost of producing each unit. Therefore, an increase in variable costs would result in an increase in the break-even point.

If Variable Costs Per Unit Increased Because of an Increase