If the fixed cost is $50000 and the contribution margin percentage is 20%, then the breakeven revenue will be _____________?
Correct answer: C. $250,000
- A. $100,000
- B. $150,000
- C. $250,000
- D. $225,000
Explanation
Break-even revenue is calculated as fixed costs divided by the contribution margin percentage: $50,000 ÷ 20% = $250,000. Option c is correct.
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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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