What technique is based on computing the quantity of goods a company needs to sell to just cover its costs?
A) net present value
B) break-even analysis
C) internal rate of return
D) activity based costing
E) variable costing

Question

Quizplus · Accepted Answer

Break-even analysis is a technique used to calculate the number of units a company needs to sell to cover its costs, or "break even." It is a useful tool for businesses to determine their pricing strategy and to assess the feasibility of a new business venture. Net present value, internal rate of return, activity based costing, and variable costing are all different cost accounting techniques and not directly related to calculating the break-even point.

What Technique Is Based on Computing the Quantity of Goods