Question

The break-even point is the level at which revenues: equal fixed costs equal variable costs equal...

The break-even point is the level at which revenues:

equal fixed costs

equal variable costs

equal fixed costs minus flexible costs

equal variable costs plus capacity-related costs
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Answer #1

ans : (d) equals variable cost plus capacity related cost

Explanation:

Breakeven point is a point at which the sales revenue are just enough to cover the variable cost and fixed cost . At breakeven point net income will be zero. The contribution will be enough to cover fixed cost. Here, capacity related cost are fixed in nature . therefore answer to the above question is option (d)

Breakeven point is a level at which revenues equals variable cost plus capacity related cost.

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