The formula 'Fixed Cost / Contribution Margin per Unit' is used to find: MCQ with Answer and Explanation

The formula 'Fixed Cost / Contribution Margin per Unit' is used to find:

A. Target Profit

B. Break-Even Point in Sales Value

C. Margin of Safety

D. Break-Even Point in Units

Answer: Option D

This formula yields the exact number of units a company needs to sell to cover all its fixed and variable costs.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

No comments yet. Be the first to start the discussion!

Question #1 Report Error

A tax levied on a person based on their net wealth was the Wealth Tax. In India, Wealth Tax was abolished in:

A. 2015

B. 2017

C. 2005

D. 1991

Correct Answer: Option A

Explanation:
Wealth tax was abolished in the Union Budget of 2015-16, replaced by an additional surcharge on the super-rich.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

Question #2 Report Error

In a voucher system, which voucher is used to record credit sales?

A. Journal voucher

B. Debit voucher

C. Cash voucher

D. Credit voucher

Correct Answer: Option A

Explanation:
Credit sales involve no immediate cash, so a journal voucher (non-cash voucher) is used to record the transaction.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

Question #3 Report Error

Which of the following is not a purpose of financial audit?

A. Ensuring compliance with laws

B. Detecting fraud and error

C. Preparing financial statements

D. Expressing opinion on true and fair view

Correct Answer: Option C

Explanation:
Preparation of financial statements is management's responsibility. Auditor expresses opinion on them.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping