If the fixed cost is $30000, the contribution margin percentage is 40%, then the breakeven revenue will be ____________?
Correct answer: B. $75,000
- A. $120,000
- B. $75,000
- C. $12,000
- D. $175,000
Explanation
Break-even revenue equals fixed cost divided by the contribution margin percentage: $30,000 ÷ 40% = $75,000. At this revenue, the contribution margin exactly covers fixed costs.
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About Cost Accounting
Cost accounting measures and analyses the cost of producing goods or providing services for planning, control and pricing decisions. It covers direct and indirect costs, fixed and variable costs, job and process costing, break-even analysis, marginal costing, overhead allocation, and the difference between product cost and period cost.
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