Chamiching Makes Hacksaw Blades In the First Year,variable Costs Accounted for Half of the First

question 1

Multiple Choice

Chamiching makes hacksaw blades.Inventory values are determined using the first in,first out (FIFO) method.Production and sales data for the first three years appear below. $\begin{array}{ccc}\text { Hacksaw blades } & \text { Sold } & \text { Produced } \\\text { Yr } 1 & 18,000 & 22,000 \\\text { Yr } 2 & 25,000 & 23,000 \\\text { Yr } 3 & 37,000 & 35,000\end{array}$
In the first year,variable costs accounted for half of the full costs.Total fixed production costs increased each subsequent year by 20%,as a result of step-fixed costs and a general inflationary price increase.
For Chamiching,if absorption costing is used,which of the following is true?

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Definitions:

Relatively Lower Wages

Wages that are lower when compared to a certain benchmark, such as the national average, industry standard, or a competing firm.

Minorities

Groups in a population that are smaller in number than the main group and may have different national, religious, linguistic, or cultural origins.

Great Depression

A severe worldwide economic downturn that took place during the 1930s, characterized by high unemployment, deflation, and a fall in consumer spending and investment.

Welfare Payments

Government-provided assistance to individuals and families in need to help cover basic living expenses.