The break-even point in a cost-volume-profit graph is always found:
A)At 50% of full capacity.
B)At the sales volume resulting in the lowest average unit cost.
C)At the volume at which total revenue equals total variable costs.
D)At the volume at which total revenue equals total fixed costs plus total variable costs.

Question

Quizplus · Accepted Answer

The break-even point occurs at the volume where total revenue equals total fixed costs plus total variable costs, meaning the business is not making a profit but also not incurring a loss.

The Break-Even Point in a Cost-Volume-Profit Graph Is Always Found