Solved: Break-even point-net operating income, Accounting Basics

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Break-even point-net operating income

Question 1. South Company sells a single product for $20 per unit. If variable expenses are 60% of sales and fixed expenses total $9,600, the break-even point will be:

A. $24,000
B. $14,400
C. $9,600
D. $16,000

Question 2. Arthur Company has a margin of safety percentage of 25%. The break-even point is $300,000 and the variable expenses are 45% of sales. Given this information, the net operating income is:

A. $75,000
B. $55,000
C. $15,000
D. $41,250

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