1. Selling price per unit, variable cost per unit and Rs.60; Fixed expenses Rs.

7,200; How much is

total fixed cost per unit of Taranagar company the break even point in money?
are Rs. 120, Rs. 72 and Rs. 3,84,000
respectively. How many units should be sold to A. 5,400 Tk.
make a profit of Rs 96,000? B. 9,600 Tk.
C. 28,800 Tk.
A. 8,000 units D. 21,600 Tk.
B. 5,333 units
C. 3,200 units
D. 4,000 units
E. 10,000 units 7. Which relationship is not correct if contribution
margin (C), total sales revenue (T), variable cost
2. Which information is unnecessary in (V), profit (π), fixed cost (F), loss (L), and
determining the break-even point of a company? contribution margin ratio (R)?

A. Fixed costs A. C = T - V
B. Variable cost B. C = π - F
C. Product cost C. C = F - L
D. Contribution margin D. C = T x R
E. Average cost
8. Selling price per unit, variable cost per unit, and
3. Selling price per unit, variable cost per unit, and total fixed cost of Barilgaon Company are
total fixed cost of Y Company are Rs.120, Rs.160, Rs.85, and Rs.5,00,000 respectively.
Rs.72, and Rs.3,84,000 respectively. How many How many units of product should be sold to
units of product must be sold if the company earn a profit of Rs.1,00,000?
wants to earn a profit of Rs.48,000/-?
A. 8,000
A. 8,000 units B. 6,667
B. 9,000 units C. 5,333
C. 10,000 units D. 10,000
D. 3,200 units
E. 4,000 units 9. A firm has a variable cost of Rs.25,000 and a
contribution margin ratio of 50%. How much is
4. The distance of actual sale from the collection the company's sales?
point is called—
A. Rs.37,500
A. Cost edge B. Rs.50,000
B. Operating leverage C. Rs.75,000
C. Financial leverage D. Rs.1,00,000
D. Safety margin E. Rs.1,50,000

5. If the sale per unit is Rs.20; If the variable cost

is Rs 12 per unit, and the fixed cost is Rs
35,000, what is the total sales unit?

A. 1,013 units
B. 1,750 units
C. 2,917 units 10. An organization has a monthly fixed cost of
D. 4,375 units Rs.20,000 and a variable cost ratio of 80%.
What is the company's monthly break-even
6. Selling price per unit of a product of an point?
organization is Rs.80; Variable cost per unit is
 Break- Even Point
A. Rs.50,000 A. 2,000 units
B. Rs.1,00,000 B. 3,000 units
C. Rs.80,000 C. 4,000 units
D. Rs.1,60,000 D. 6,000 units
E. Rs.40,000 E. None

11. Margin of safety will increase if- 16. What is the margin of safety ratio if Marshall
Company's sales are Rs 6,00,000 and breakeven
A. Production and sales increase point is Rs 4,20,000?
B. Selling price per unit decreases
C. Variable costs increase A. 25%
D. Fixed costs increase B. 30%
C. 33%
12. A firm's sales amount to Rs.1,00,000. If the D. 45%
firm's contribution margin ratio is 40%, what is
the amount of variable cost? 17. Selling price per unit of an organization is
Rs.100, variable cost per unit is Rs.60, total
A. Rs.20,000 fixed cost is Rs.80,000. If 3500 units of the
B. Rs.30,000 product are sold in the current year, what is the
C. Rs.40,000 margin of safety?
D. Rs.50,000
E. Rs.60,000 A. Rs.140,000
B. Rs.150,000
13. Which of the following does not affect the break C. Rs.210,000
even point? D. Rs.350,000

A. An increase in fixed costs 18. A firm's sales amount to Rs.1,00,000. If the

B. An increase in variable costs variable cost ratio is 45%, what is the
C. Increase in units sold contribution margin?
D. Increase in selling price
E. Increase in wages A. Rs.45,000
B. Rs.50,000
14. A company plans to sell 2,00,000 pens at Rs.4 C. Rs.55,000
per unit. If the sales ratio is 25% and that D. Rs.60,000
amount of sales is the break-even point, what is E. Rs.65,000
the amount of its fixed costs?

A. Rs.1,00,000
B. Rs.1,60,000
C. Rs.2,00,000
D. Rs.3,00,000

19. A company has sales of Rs.14,00,000, margin of

safety ratio of 40%, and profit margin ratio of
15. Annual expenditure on fixed expenses is 20%. How much money is the break-even
Rs.30,000. Variable cost is Rs.5 per unit and point?
selling price is Rs.15 per unit. Annual sales
demand is 7,000 units. What is the break-even A. Rs.7,50,000
point? B. Rs.8,20,000
 Break- Even Point
C. Rs.8,40,000
D. Rs.8,60,000
E. None

20. Ayesha Boutiques has an annual production

capacity of 3,000 units and during the current
accounting period it is completely sold as well
as produced. According to the accounting
information, the selling price per unit is Tk 50,
the variable cost is Tk 25 and the fixed cost is
Tk 15. What is the safety margin of the
business?

A. Rs.60,000
B. Rs.65,000
C. Rs.70,000
D. Rs.75,000
 Break- Even Point
Test: 7. By which is sales determined?

1. Which is a management tool for collecting and A. Variable cost + fixed cost
analyzing relevant data for decision making? B. Variable cost + Fixed cost + Profit
C. Variable cost + Profit
A. Financial Accounting D. Total cost + Contribution margin
B. Production cost accounting
C. Human Resource Accounting 8. Variable costing is determined by which?
D. Management accounting
A. Sales – Fixed Cost – Profit
2. In what year did management accounting B. Sales – Contribution Margin – Fixed Costs
become modern and gain recognition? C. Sales – fixed costs + profit
D. Sales – Profit + Fixed Expenses
A. 1977
B. 1800 9. Which is the formula for determining fixed
C. 1950 cost?
D. 1973
A. Contribution margin + Profit
3. Which country can be called as the first B. Contribution Margin – Profit
application of management accounting? C. Contribution Margin – Loss
D. Sales – Profit + Variable Costs
A. Italy
B. India 10. Contribution margin per unit is determined by
C. United Kingdom which formula?
D. United States
A. Contribution margin per unit = Selling price per
4. Contribution margin ratio is determined by unit + Variable cost per unit
which? B. Contribution margin per unit = Selling price per
unit × Variable cost per unit
A. Gross profit / sales C. Contribution margin per unit = Selling price per
B. Operating profit / sales unit – Variable cost per unit
C. Contribution margin / sales D. Contribution margin per unit = Selling price per
D. Contribution margin / fixed cost unit / Variable cost per unit

5. Contribution margin is determined by which?

A. Selling - variable expenses

B. Sales + Fixed Expenses
C. Fixed cost - profit
D. Sales + contribution margin ratio

6. Margin of safety is determined by which of the

following?

A. Actual sales - breakeven sales

B. Profit / contribution margin ratio
C. Contribution margin ratio / profit
D. Actual sales + break-even sales