If sales units exceeds the break-even point in units, the firm will experience .

(A) an operating loss.
(B) an operating profit.
(C) an increase in plant and equipment.
(D) an increase in stock price.

The answer is B. an operating profit

Explanation:

Knowing your break-even point is knowing the point where profit and loss start.

Break-even sales is the number of sales a firm will sell to make neither profit nor loss. Also, in break-even total revenue equals total cost.

Break-even is calculated as follows

= Fixed cost/(sales per unit - variable cosy).

Therefore, If sales units exceeds the break-even point in units, the firm will experience an operating profit and If sales units are lower than the break-even point in units, the firm will experience an operating loss

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