The preferred approach to breakeven analysis for the multiproduct firm is the
A) breakeven point expressed in units.
B) breakeven point expressed in dollars.
C) cash breakeven point.
D) overall breakeven point.

Question

Quizplus · Accepted Answer

Expressing the breakeven point in dollars takes into account the varying prices and profit margins of the different products, making it the preferred approach for a multiproduct firm. It allows for a more accurate representation of the point at which the firm is covering all of its costs and generating profit.

The Preferred Approach to Breakeven Analysis for the Multiproduct Firm