Question 1

If a company has a contribution margin ratio of 60%, the company's variable expense ratio is:

Group of answer choices

100%

Cannot be determined with the given information

40%

60%

Question 2

To find the break-even point in units using the equation method, we set the profit equal to zero.

Group of answer choices

True

False

Question 3

The equation for target profit is the same for break-even point in dollars

Group of answer choices

True

False

Question 4

Coffee Klatch is an espresso stand in a downtown office building. The average selling price of a cup of coffee is $1.49 and the average variable expense per cup is $0.36. The average fixed expense per month is $1,300. How many cups of coffee would have to be sold to attain target profits of $2,500 per month?

Group of answer choices

1,150 cups

3,363 cups

2,212 cups

4,200 cups

Question 5

Coffee Klatch is an espresso stand in a downtown office building. The average selling price of a cup of coffee is $1.49 and the average variable expense per cup is $0.36. The average fixed expense per month is $1,300. An average of 2,100 cups are sold each month. What is the margin of safety expressed in cups?

Group of answer choices

2,100 cups

950 cups

1,150 cups

3,250 cups