Break Even Practice Questions –HSC BUSINESS STUDIES

Question 1.

Claire is selling t-shirts for $40. The t-shirts cost $16 to produce, and her overheads for fixed costs of
manufacturing are $120000.

Using the break even formula, calculate the breakeven.

Question 2.

Peter’s factory manufactures tables. Each table is sold for $1000, but it has variable costs of $300. The
total fixed costs at the factory are $1400000. How many tables does Peter’s factory need to produce to
break even?

Question 3.

Claire’s factory produces surfboards. Each surf board is sold for $100, and has fixed costs of $40. The
overheads fixed costs for the factory are $300000. Calculate the break even, and draw a break even
graph.

Question 4.

Explain the importance of break-even analysis.

Question 5.

Distinguish between fixed and variable costs. Give examples of each.

Question 6.

Explain the importance of forecasting.

Question 7.

How can a business forecast it’s revenue and expenses?

Question 8.

Do revision Qs 4, 6, 7 on page 424