1) What is break even? a) It is when a business sells enough units to cover the business ' costs  b) It is when a business makes enough money to make aprofit c) It is when a business makes a loss 2) Choose 2 options that are fixed costs a) Rent b) Electricity c) Ingredients d) Packaging 3) Choose the formula for the break even a) Variable cost per unit - Selling price per unit/(divided by) Fixed Costs b) Selling price per unit -  Variable cost per unit -(divided by) Fixed Costs c) Fixed Costs / (divided by ) Selling price per unit - Variable cost per unit 4) What is the Margin of safety ? a) The margin of safety is the amount by which the anticipated (budgeted) sales can fall before the business makes a loss. b) The margin of safety is the amount by which the anticipated (budgeted) sales can fall before the business makes a profit. c) Margin of safety (units) = Budgeted sales units – Breakeven sales units d) Margin of safety (units) = Breakeven sales units – Budgeted sales units 5) A business wants to know how many products they need to sell to make £8000 profit. What formula do they need to use? a) Profit or Loss b) Margin of Safety c) Target Profit 6) Which line is not shown on a Break Even chart? a) Sales Revenue b) Variable Costs c) Total Costs d) Fixed Costs 7) What is an example of a variable cost? a) Direct Labour b) Raw Materials c) Packaging Materials d) All of the above 8) A cost you can easily link to production is known as a) a direct cost b) an indirect cost 9) The total costs line on a break even chart will always start at: a) The same starting point as fixed costs b) £0 (the bottom corner) 10) Sales Revenue on a Break Even chart will always start at a) The same starting point as fixed costs b) £0 (the bottom corner)

Break Even Quiz

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