The break-even point can be calculated in two ways: dividing fixed costs by either the unit contribution margin or the PV ratio.

Question

Quizplus · Accepted Answer

The break-even point can indeed be calculated by dividing fixed costs by the unit contribution margin (price per unit minus variable cost per unit) or by dividing fixed costs by the PV ratio (Profit-Volume ratio, which is the contribution margin divided by sales).

The Break-Even Point Can Be Calculated in Two Ways: Dividing