Break-even point equates revenue to total costs

Steps:

• Break-even occurs when profit is zero, so total revenue (TR) equals total costs (TC).
• Total costs consist of total fixed costs (TFC) plus total variable costs (TVC): TC = TFC + TVC.
• At break-even, TR covers all costs exactly: TR = TFC + TVC.
• Thus, TR equals the sum of total variable and fixed costs.

Why C is correct:

• By definition, at break-even, TR = TC, and TC is total variable costs plus total fixed costs (basic cost-volume-profit formula).

Why the others are wrong:

• A: Total contribution (TR - TVC) equals TFC at break-even, not TR.
• B: Total fixed costs are only part of TC; TR exceeds TFC to cover TVC too.
• D: Total variable costs equal TR only if TFC is zero, which is not the case.

Final answer: C