Fire Cat,Inc What Is the Total of Manufacturing Costs Incurred by Fire

question 107

Multiple Choice

Fire Cat,Inc.selected cost data for the year are shown below: $\begin{array} { | l | r | } \hline \text { Cost of Goods Manufactured } & \$ 145,500 \\\hline \text { Work-in-Process Inventory, Jan. 1 } & 19,500 \\\hline \text { Work-in-Process Inventory, Dec. } 31 & 22,000 \\\hline \text { Direct Materials Used } & 18,600 \\\hline\end{array}$ What is the total of manufacturing costs incurred by Fire Cat,Inc.during the year?

• A) $148,000
• B) $143,000
• C) $22,900
• D) $38,100

---

Definitions:

Diseconomies of Scale

The phenomenon where production costs per unit increase as a firm's output expands, often due to inefficiencies that arise from becoming too large.

Economies of Scale

Cost advantages that enterprises obtain due to their scale of operation, with cost per unit of output generally decreasing with increasing scale.

Average Total Cost

The total cost of production divided by the quantity of output produced; it includes all variable and fixed costs.

Economies of Scale

The cost advantages that enterprises obtain due to their scale of operation, with cost per unit of output generally decreasing with increasing scale as fixed costs are spread out over more units of output.