If the fixed costs increase while the sales price per unit and variable costs per unit remain constant, which of the following statements is true?

Question

Quizplus · Accepted Answer

The contribution margin, which is the sales price per unit minus the variable cost per unit, remains unchanged because neither the sales price nor the variable costs are affected by the change in fixed costs. However, the breakeven point, which is the level of sales at which total revenues equal total costs, increases because higher fixed costs require more units to be sold to cover those costs.

If the Fixed Costs Increase While the Sales Price Per