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CA Final Strategic Management — practice by topic

Browse 46 questions across 1 Strategic Management topics. Choose what you want to revise, then open a question to check its answer and worked solution.

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Strategic Management topics

Integrated Business Solutions (46)

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Fixed cost is Rs 60,000, price Rs 50 and variable cost Rs 20 per unit. Break-even units?Read the answer and worked solution →What is a firm's total profit exactly at its break-even point?Read the answer and worked solution →To pass break-even, the selling price must exceed which cost?Read the answer and worked solution →A firm sells too few units to break even. Which step lowers its break-even point?Read the answer and worked solution →

Worked practice questions

Fixed cost is Rs 60,000, price Rs 50 and variable cost Rs 20 per unit. Break-even units?

  1. 2,500 units
  2. 3,000 units
  3. 1,200 units
  4. 2,000 units
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Correct answer: D. 2,000 units

Contribution is Rs 30 per unit, so 60,000 divided by 30 gives 2,000 units to cover fixed cost.

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What is a firm's total profit exactly at its break-even point?

  1. Equal to fixed costs
  2. Equal to contribution
  3. Equal to total revenue
  4. Exactly equal to zero
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Correct answer: D. Exactly equal to zero

At break-even revenue exactly covers fixed and variable costs, leaving neither profit nor loss.

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To pass break-even, the selling price must exceed which cost?

  1. Rent paid per month
  2. Interest on old loans
  3. Tax paid per year
  4. Variable cost per unit
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Correct answer: D. Variable cost per unit

Each unit must earn more than its variable cost so that a positive contribution is left to recover fixed costs.

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