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Cost Volume Profit Applied to the Service Industry

Question 72

Multiple Choice

Cost volume profit applied to the service industry
A nursing home has the following annual budget: Cost volume profit applied to the service industry A nursing home has the following annual budget:   Which of the following statements is correct if fixed administration costs were increased by $50 000 and all other matters remained the same? A)  The break-even point in inpatient days would increase. B)  The contribution would decrease. C)  The net profit would increase. D)  There would be no change in break-even point.
Which of the following statements is correct if fixed administration costs were increased by $50 000 and all other matters remained the same?


A) The break-even point in inpatient days would increase.
B) The contribution would decrease.
C) The net profit would increase.
D) There would be no change in break-even point.

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