The point where the sales line and the total costs line intersect on the cost-volume-profit graph represents:
A) the maximum possible operating loss.
B) the maximum possible operating income.
C) the total fixed costs.
D) the break-even point.

Question

Quizplus · Accepted Answer

The point where the sales line and the total costs line intersect on the cost-volume-profit graph represents the break-even point. This is the point where the company neither makes a profit nor suffers a loss, and the sales revenue is just enough to cover the total costs of the business.

The Point Where the Sales Line and the Total Costs