A Company Has the Following Information for Its First Month

question 40

Multiple Choice

A company has the following information for its first month of operations: $$\begin{array} { l r } \text { Raw materials used } & \$ 37,500 \\\text { Sales } \$ 97.50 \text { per unit) } & \$ 117,000 \\\text { Direct labor } & \$ 63,000 \\\text { Variable factory overhead } & \$ 25,500 \\\text { Fixed factory overhead } & \text { unknown } \\\text { Variable selling and administrative } & \$ 4,500 \\\text { Fixed selling and administrative } & \$ 7,500 \\\text { Gross profit } & \$ 45,000 \\\text { Contribution margin } & \text { unknown }\end{array}$$ The company sold half of the 2,400 units it produced._____ of factory overhead is included in the ending inventory under absorption costing.

• A)$18,000
• B)$9,000
• C)$12,600
• D)$-0-

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Definitions:

Top of Mind Awareness

A marketing term referring to a brand or product being the first one that comes to customers' minds when thinking of a particular industry or category.

Commoditization

The process by which goods or services become undifferentiated in the eyes of the consumer, leading to competition primarily on price rather than quality or brand.

Brand Salience

Refers to the degree to which a brand is thought about or noticed by consumers when making purchase decisions.

Top of Mind Awareness

The first brand or product that comes to mind when a consumer thinks about a specific category.