If ‘F’ is the fixed cost, ‘V’ is the variable cost per unit (or total variable costs) and ‘P’ is the selling price of each unit (or total sales value), then break-even point is equal to

A $$\frac{{{\text{F}} \times {\text{V}}}}{{\text{P}}}$$
B $$\frac{{{\text{F}} \times {\text{P}}}}{{\text{V}}}$$
C $$\frac{{\text{F}}}{{1 + \frac{{\text{V}}}{{\text{P}}}}}$$
D $$\frac{{\text{F}}}{{1 - \frac{{\text{V}}}{{\text{P}}}}}$$

Correct Answer: $$\frac{{\text{F}}}{{1 - \frac{{\text{V}}}{{\text{P}}}}}$$

If ‘F’ is the fixed cost, ‘V’ is the variable cost per unit (or total variable costs) and ‘P’ is the selling price of each unit (or total sales value), then break-even point is equal to $$\frac{{\text{F}}}{{1 - \frac{{\text{V}}}{{\text{P}}}}}.$$
Bissoy MCQ
#Mechanical Engineering #Industrial Engineering And Production Management

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