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If a multi-product company simply wants to know the overall break-even point

If a multi-product company simply wants to know the overall break-even point, it is easiest to use the break-even in sales revenue approach.

 

 

22.In a multi-product firm, if the sales mix changes, the break-even points for each product will change.

 

 

23.Direct fixed expenses are the fixed costs that are NOT traceable to the segments and would remain even if one of the segments was eliminated.

 

 

24.Common fixed expenses are the fixed costs that are NOT traceable to the segments and would remain even if one of the segments was eliminated.

 

 

25.If the break-even point increases, the margin of safety increases.

 

 

26.The margin of safety measures the difference between operating income and break-even income.

 

 

27.Operating leverage is the use of fixed cost to extract higher percentage changes in profits as sales activity changes.

Mar 13 2020 View more View Less

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