The computation for the shutdown point is A. Avoidable fixed costs ÷ unit contribution margin B. Differential fixed costs ÷ contribution margin ratio C. (Avoidable fixed costs + additional cost) ÷ unit contribution margin D. (Avoidable fixed costs – additional cost) ÷ unit contribution margin

The computation for the shutdown point is A. Avoidable fixed costs ÷ unit contribution margin B. Differential fixed costs ÷ contribution margin ratio C. (Avoidable fixed costs + additional cost) ÷ unit contribution margin D. (Avoidable fixed costs – additional cost) ÷ unit contribution margin

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter2: Building Blocks Of Managerial Accounting

Section: Chapter Questions

Problem 14MC: Which of the following statements is true regarding average fixed costs? A. Average fixed costs per...

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Question

The computation for the shutdown point is

A. Avoidable fixed costs ÷ unit contribution margin

B. Differential fixed costs ÷ contribution margin ratio

C. (Avoidable fixed costs + additional cost) ÷ unit contribution margin

D. (Avoidable fixed costs – additional cost) ÷ unit contribution margin

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