If the fixed cost is $40000 and the contribution margin per unit is $800 per unit, then the breakeven of units will be ___________?
Correct answer: C. 50 units
- A. 60 units
- B. 30 units
- C. 50 units
- D. 70 units
Explanation
Break-even units are found by dividing total fixed costs by contribution margin per unit: $40,000 ÷ $800 = 50 units. Option c matches this calculation.
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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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