College

Which of these pairs of costs and revenues could a company have if it's at its break-even point?

A. Costs of [tex]$5000[/tex] and revenues of [tex]$6000[/tex]
B. Costs of [tex]$5000[/tex] and revenues of [tex]$7000[/tex]
C. Costs of [tex]$6000[/tex] and revenues of [tex]$7000[/tex]
D. Costs of [tex]$6000[/tex] and revenues of [tex]$6000[/tex]

Answer :

To determine which pair of costs and revenues represents a company at its break-even point, we need to understand that at the break-even point, the company's costs are exactly equal to its revenues. This means that the company is neither making a profit nor incurring a loss.

Let's analyze each option:

- Option A: Costs of [tex]$5000 and revenues of $[/tex]6000.
- Here, revenues are greater than costs, indicating that the company is making a profit. This is not the break-even point.

- Option B: Costs of [tex]$5000 and revenues of $[/tex]7000.
- Like option A, revenues exceed costs, which means the company is making a profit. This is not the break-even point.

- Option C: Costs of [tex]$6000 and revenues of $[/tex]7000.
- The revenues once again exceed the costs, indicating a profit. This does not represent the break-even point.

- Option D: Costs of [tex]$6000 and revenues of $[/tex]6000.
- In this case, costs are exactly equal to revenues. This situation indicates that the company is at its break-even point, as there is no profit or loss.

Therefore, the correct pair that represents a company at its break-even point is Option D: Costs of [tex]$6000 and revenues of $[/tex]6000.