Which of the following would take place if a company experienced an increase in fixed costs quizlet?

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What would take place if a company experienced an increase in fixed costs?
What happens to break
Which of the following best describes a fixed cost?
What happens to profit when variable cost increases?

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13. A recent income statement of Fox Corporation reported the following data:
Sales revenue $3,600,000
Variable costs 1,600,000
Fixed costs 1,000,000
If these data are based on the sale of 10,000 units, the break-even point would be:
A. 2,000 units.
B. 2,778 units.
C. 3,600 units.
D. 5,000 units.
E. an amount other than those above.

14. A recent income statement of Yale Corporation reported the following data:
Sales revenue $2,500,000
Variable costs 1,500,000
Fixed costs 800,000
If these data are based on the sale of 5,000 units, the break-even sales would be:
A. $2,000,000.
B. $2,206,000.
C. $2,500,000.
D. $10,000,000.
E. an amount other than those above.

33. A recent income statement of Oslo Corporation reported the following data:
Units sold 8,000
Sales revenue $7,200,000
Variable costs 4,000,000
Fixed costs 1,600,000
If the company desired to earn a target net profit of $480,000, it would have to sell:
A. 1,200 units.
B. 2,800 units.
C. 4,000 units.
D. 5,200 units.
E. an amount other than those above.

34. Yellow, Inc., sells a single product for $10. Variable costs are $4 per unit and fixed costs total $120,000 at a volume level of 10,000 units. What dollar sales level would Yellow have to achieve to earn a target net profit of $240,000?
A. $400,000.
B. $500,000.
C. $600,000.
D. $750,000.
E. $900,000.

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What would take place if a company experienced an increase in fixed costs?

Answer and Explanation: Answer: B. The break-even point would increase. If the fixed cost would increase, the break-even point would increase.

What happens to break

An increase in fixed cost will increase the break-even units as an increase in the numerator will increase the ratio. The break-even point is calculated as fixed cost divided by contribution per unit, so as the fixed cost increases the units required to cover the fixed cost will also increase.

Which of the following best describes a fixed cost?

The correct answer to the given question is option e. Costs that do not vary as output varies. The total fixed cost is the cost which does not change with the output or production volume within a relevant range.