Question

What is the formula for determining a break-even point?

question 10 options:

break-even point = total cost / product or service sales price


break-even point = total cost + product or service sales price


break-even point = total cost - product or service sales price


break-even point = total cost x product or service sales price

Answer 1

Break-even Point = Fixed Costs/Contribution Margin

Step-by-step explanation:

None of these answers are technically correct, though option A would be the closest of the four. The formula to find the break-even point is:

= fixed costs/(selling price - variable costs)

or

= fixed costs/contribution margin