Which of the following occurs if a company experiences a decrease in its fixed costs?
A) Income would decrease.
B) The break-even point would decrease.
C) The contribution margin would increase.
D) The contribution margin would decrease.
E) More than one of the answers would occur.

Question

Quizplus · Accepted Answer

A decrease in fixed costs would lower the break-even point, as less revenue is needed to cover lower fixed costs before the company starts making a profit.

Which of the Following Occurs If a Company Experiences a Decrease