Question

Which one of the following control techniques provides basis for collective actions to be taken to improve future performance?

• A. Internal audit
• B. Standard costing
• C. Break-even analysis
• D. Statistical control.

Answer 1

The correct option is C Break-even analysis

Break even Analysis is point of 'No Profit No loss'. Company tries to sell their product up to the break even point because it is the point where total cost equals to total sale value and company will not get any loss. Any sales below this point means that total cost is more than total sale value and company will suffer losses.