Two companies sell an identical product at the same selling price of $12.00. Mini's production is quite labour intensive with variable costs of $3.50 per unit and fixed costs of $100,000. Maxi has invested more in labour-saving technology and has fixed costs of $150,000 and variable costs of $2.00 per unit. Compared to maxi, Mini has a:
A) Higher breakeven point and a higher contribution per unit
B) Lower breakeven point and a lower contribution per unit
C) Higher breakeven point and a lower contribution per unit
D) Lower breakeven point and a higher contribution per unit
Correct Answer:
Verified
Q7: Use the following information
Q8: Use the following information
Q9: Use the following information
Q10: Sales mix affects profitability because:
A) Different products
Q11: Operating leverage is:
A) The ratio of debt
Q13: CVP analysis is;
A) Useful in all cases
B)
Q14: A company has a selling price
Q15: XYZ Inc has made an investment of
Q16: Widget Co has fixed costs of
Q17: BCD Inc sells its products for $12
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