Question:-
Which one of the following information combinations has lowest break-even point?
Fixed cost
(in Rs.)
Variable
cost/unit
(in Rs.)
Revenue
uni t
(in Rs.)
a. 30,000 10 40
b. 40,000 15 40
c. 50,000 20 40
d. 60,000 30 40
Option (A)
A
Option (B)
B
Option(C)
C
Option(D)
D
Correct Option:
(A)
Question Solution:
For case
(A) Break Even Quantity = (30000 / (40-10)) = 1000
(B) Break Even Quantity = (40000 / (40-15)) = 1600
(C) Break Even Quantity = (50000 / (40-20) )= 2500
(D) Break Even Quantity = (60000 / (40-30)) = 6000
\ Break Even point is lowest for (A)
question-answer-faq-8827