A company that makes environmental measuring devices has calculated their revenue and costs as follows for the most recent fiscal period: Sales $750 000
Costs:
Fixed Costs $200 000
Variable Costs 250 000
Total Costs 450 000
Net Income $300 000
What is the break-even point in sales dollars?
A) $100 000
B) $200 000
C) $300 000
D) $250 000
E) $450 000

Question

Quizplus · Accepted Answer

The break-even point is where total revenue equals total costs. Fixed costs are $200,000, and the contribution margin (Sales - Variable Costs) is $500,000. The break-even point is $200,000 / ($750,000 - $250,000) * $750,000 = $300,000.

A Company That Makes Environmental Measuring Devices Has Calculated Their