Refer to the Graph Shown

question 197

Multiple Choice

Refer to the graph shown. In equilibrium, total surplus is equal to:

• A)600.
• B)1,200.
• C)1,400.
• D)2,000.

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Definitions:

Direct Labor-Hours

Represents the total hours worked directly on the production of goods.

Manufacturing Overhead

Costs related to the manufacturing process that cannot be directly linked to specific products, including utility costs, depreciation, and maintenance of equipment.

Predetermined Overhead Rate

An allocated rate used to apply manufacturing overhead to products or job orders, estimated at the start of an accounting period.

Job-Order Costing

A costing system used to accumulate costs for individual jobs or orders, typically used when products or services are distinct and customized.