Practice Break-even Point Formulas - 22.4 | 22. Break-even Analysis and Marginal Costing | Management 1 (Organizational Behaviour/Finance & Accounting)
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22.4 - Break-even Point Formulas

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Learning

Practice Questions

Test your understanding with targeted questions related to the topic.

Question 1

Easy

What is the formula for calculating the break-even point in units?

💡 Hint: Think about how fixed costs and variable costs relate to each other.

Question 2

Easy

If selling price per unit is ₹300 and variable cost is ₹200, what is the contribution per unit?

💡 Hint: Remember to subtract the variable cost from the selling price.

Practice 4 more questions and get performance evaluation

Interactive Quizzes

Engage in quick quizzes to reinforce what you've learned and check your comprehension.

Question 1

What is the formula for break-even in units?

  • A) Fixed Costs / Selling Price
  • B) Fixed Costs / (Selling Price - Variable Cost)
  • C) Fixed Costs + Variable Costs

💡 Hint: What do you divide to determine how many units you need to sell?

Question 2

The contribution margin ratio (CMR) is calculated by dividing which two numbers?

💡 Hint: What two values do we need to find the ratio?

Solve 1 more question and get performance evaluation

Challenge Problems

Push your limits with challenges.

Question 1

A software as a service (SaaS) company has fixed costs of ₹80,000, a selling price per subscription of ₹400, and variable costs of ₹250 per subscription. Calculate the break-even point in units and sales value.

💡 Hint: Calculate units first, rounding as needed, then convert to sales value.

Question 2

If a company expects to increase its fixed costs by ₹25,000 next year but also anticipates a 10% rise in selling price while keeping variable costs the same, how will it affect the break-even point?

💡 Hint: Consider how both changes affect profitability.

Challenge and get performance evaluation