Discussion
At operating Break-even Point which of the following is true ?
Answer: D
At the operating break-even point EBIT is zero.
The operating break-even point is the level of sales at which revenue just covers all operating costs, fixed and variable, so earnings before interest and tax are nil. In terms of contribution, total contribution equals fixed operating cost.
Sales revenue covering only the fixed cost would ignore variable cost. Equality of fixed and variable cost has nothing to do with break-even. The phrase 'revenue variable cost' in option B is not a defined measure.
No comment is present. Be the first to comment.
Loading…
Post your comment
Please log in or register to post a comment.
Examination Categories
- SSC Exams
- Banking Exams
- Teaching Exams
- Civil Services Exams
- Railways Exams
- Engineering Recruitment Exams
- Defence Exams
- State Government Exams
- Police Exams
- Insurance Exams
- Nursing Exams
- Other Government Exams
- NRA CET
- PG Entrance Exams
- Campus Placement
- MBA Entrance Exams
- CUET and UG Entrance
- Judiciary Exams
- Regulatory Body Exams
- Software Development