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Unofficial practice for the ACCA Performance Management (PM) exam. Not affiliated with or endorsed by ACCA.

Practice · Syllabus C2

Cost-volume-profit

Breakeven units are fixed costs divided by contribution per unit; the margin of safety is budgeted sales less breakeven sales.

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Question 1 · Section A · Syllabus C22 marks

Cost-volume-profit analysis

Halden Co sells product A at $20 per unit (contribution $8 per unit) and product B at $40 per unit (contribution $18 per unit). Revenue from A is always twice the revenue from B. Fixed costs are $250,000 a year.

How many units of product B are sold at the breakeven point? (2 marks)