1. Junior Company has a breakeven point of 34,600 units and is selling 35,000 units. If unit variable costs increase, the margin of safety will

a. increase

b. decrease

c. remain the same

d. it is impossible to tell

2. Bialy Company had the following information:

Total sales…………………..$120,000

Total variable cost…………..48,000

Operating income…………..12,000

What is the breakeven sales revenue?

a. $72,000

b. $60,000

c. $100,000

d. $108,000

3. If a company’s variable cost per unit increases, which of the following is true?
a. The margin of safety will increase.
b. The breakeven point in units will decrease.
c. The contribution margin ratio will decrease.
d. Operating income will increase.