Question

which of the following will result in raising the breakeven point? a. a decrease in income tax rates. b. a decrease in the variable cost per unit. c. an increase in the contribution margin per unit. d. an increase in the semivariable cost per unit.

Answer 1

The correct option is D. An increase in the semi-variable cost per unit will result in raising the breakeven point.

What is the semi-variable cost?

Semi-variable cost can be determined as the mixture of the fixed cost as well as the variable cost where the fixed costs are set at a fixed production level and in excess of the fixed cost it becomes variable costs, for example, electricity bill, etc. and its behaviour depends partly on fixed & variable costs because of which these costs are also known as mixed cost.

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