BREAK EVEN POINT
Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
Detailed explanation-1: -Lower sales prices will decrease the contribution margin per unit and cause the break-even point in unit sales to increase.
Detailed explanation-2: -Break-Even Decrease The result of is a decrease in your break-even point. This means your business must generate less revenue to break even after you increase the contribution margin for your products than prior to the contribution margin increase.
Detailed explanation-3: -An increase in fixed cost will increase the break-even units as an increase in the numerator will increase the ratio. The break-even point is calculated as fixed cost divided by contribution per unit, so as the fixed cost increases the units required to cover the fixed cost will also increase.
Detailed explanation-4: -A break-even price is the amount of money, or change in value, for which an asset must be sold to cover the costs of acquiring and owning it. It can also refer to the amount of money for which a product or service must be sold to cover the costs of manufacturing or providing it.