# 11 which of the following statements about determining the breakeven point is false 4309559

11) Which of the following statements about determining the breakeven point is FALSE?

A) Operating income is equal to zero.

B) Contribution margin – fixed costs is equal to zero.

C) Revenues equal fixed costs plus variable costs.

D) Breakeven revenues equal fixed costs divided by the variable cost per unit.

12) What is the breakeven point in units, assuming a product's selling price is \$100, fixed costs are \$8,000, unit variable costs are \$20, and operating income is \$3,200?

A) 100 units

B) 300 units

C) 400 units

D) 500 units

13) If unit outputs exceed the breakeven point:

A) there is a loss

B) total sales revenue exceeds total costs

C) there is a profit

D) Both total sales revenue exceeds total costs and there is a profit.

14) How many units would have to be sold to yield a target operating income of \$22,000, assuming variable costs are \$15 per unit, total fixed costs are \$2,000, and the unit selling price is \$20?

A) 4,800 units

B) 4,400 units

C) 4,000 units

D) 3,600 units

15) If the breakeven point is 1,000 units and each unit sells for \$50, then:

A) selling 1,250 units will result in a profit

B) sales of \$40,000 will result in a loss

C) sales of \$50,000 will result in zero profit

D) All of these answers are correct.

16) If breakeven point is 1,000 units, each unit sells for \$30, and fixed costs are \$10,000, then on a graph the:

A) total revenue line and the total cost line will intersect at \$30,000 of revenue

B) total cost line will be zero at zero units sold

C) revenue line will start at \$10,000

D) All of these answers are correct.

17) When fixed costs are \$40,000 and variable costs are 20% of the selling price, then breakeven sales are:

A) \$40,000

B) \$50,000

C) \$200,000

D) indeterminable

Answer the following questions using the information below:

Ruben intends to sell his customers a special round-trip airline ticket package. He is able to purchase the package from the airline carrier for \$150 each. The round-trip tickets will be sold for \$200 each and the airline intends to reimburse Ruben for any unsold ticket packages. Fixed costs include \$5,000 in advertising costs.

18) What is the contribution margin per ticket package?

A) \$50

B) \$100

C) \$150

D) \$200

19) How many ticket packages will Ruben need to sell to break even?

A) 34 packages

B) 50 packages

C) 100 packages

D) 150 packages

20) How many ticket packages will Ruben need to sell in order to achieve \$60,000 of operating income?

A) 367 packages

B) 434 packages

C) 1,100 packages

D) 1,

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