A Company Is Evaluating Which of Two Alternatives Should Be

question 22

Multiple Choice

A company is evaluating which of two alternatives should be used to produce a product that will sell for $35.00 per unit.The following cost information describes the two alternatives: If total demand (volume) is 120,000 units,then the company should

• A)select Process A with a profit of $940,000 to maximize profit.
• B)select Process B with a profit of $450,000 to maximize profit.
• C)select Process A with a profit of $700,000 to maximize profit.
• D)select Process B with a profit of $690,000 to maximize profit.

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Definitions:

Quarterly Revenues

The total income generated by a company during a three-month period from its business activities.

Circle Graph

A circular chart divided into sectors, each representing a proportion of the total; also known as a pie chart.

Sales Revenues

The total amount of money generated from the sale of goods or services before any expenses are subtracted.

Prescription Medicine

Medications that can only be obtained with a written order from a licensed healthcare provider.