Based on a Predicted Level of Production and Sales of 22,000

question 86

Multiple Choice

Based on a predicted level of production and sales of 22,000 units,a company anticipates total variable costs of $99,000,fixed costs of $30,000,and operating income of $36,000.Based on this information,the budgeted amount of sales for 20,000 units would be:

• A)$165,000.
• B)$150,000.
• C)$117,272.
• D)$181,500.
• E)$141,900.

---

Definitions:

Grace Period

A grace period is a set length of time after a due date during which a payment can be made without penalty.

Commercial Insurance

Insurance that covers some type of business risk.

Business Risk

The possibility that a company will have lower than anticipated profits or experience a loss rather than making a profit.

Insurance Agreement

is a contract between an insurance provider and a policyholder, specifying the terms for coverage of specified risks in exchange for premiums.