One Hundred Basis Points in Terms of Dollars Is Equal

question 7

Multiple Choice

One hundred basis points in terms of dollars is equal to __________.

• A) $0.0001
• B) $0.01
• C) $0.10
• D) $1.00

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Definitions:

Capacity

The maximum level of output that a company can sustain to produce in a given period under normal circumstances.

Machine-Hours

Machine-hours refer to the total time that machinery is in operation, often used as a basis for allocating manufacturing overhead costs.

Unused Capacity

The portion of a company's production capability or resources that is not currently being utilized to generate revenue or output.

Predetermined Overhead Rate

A rate calculated before a production period based on estimated overhead costs and activity levels, used to allocate overhead costs to products.