A Company Has the Following Information for Its First Month

question 22

Multiple Choice

A company has the following information for its first month of operations: $\begin{array}{lr}\text { Raw material s used } & \$ 25,000 \\\text { Sales } \$ 65 \text { per unit) } & \$ 78,000 \\\text { Direct } 1 \text { abor } & \$ 42,000 \\\text { Variable factory overhead } & \$ 17,000 \\\text { Fixed factory overhead } & \text { unknown }\\\text { Variable selling and administrative } & \$ 3,000 \\\text { Fixed selling and administrative } & \$ 5,000 \\\text { Gross profit } & \$ 20,000 \\\text { Contribution margin } & \text { unknown }\end{array}$ The company sold half of the units it produced._____ is the cost of goods sold under absorption costing.

• A)$30,000
• B)$78,000
• C)$58,000
• D)$42,000

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Definitions:

Vertical Axis

In a graph or chart, the vertical line or scale along which numerical data is plotted or measured, usually representing quantities.

Straight Line

A direct, shortest path between two points in a plane, often used in mathematics to describe linear functions.

Horizontal Axis

In a graph or chart, the x-axis, representing the independent variable or the base line for measuring.

Vertical Axis

In a graph or chart, the y-axis which typically represents the dependent variable or outcome in relation to the independent variable on the horizontal axis.