Pizza Company Planned to Produce 12,000 Units

question 125

Multiple Choice

Pizza Company planned to produce 12,000 units.This level of activities required 40 set-ups at a cost of $18,000 plus $500 per set-up.Actual sales were 10,000 units, requiring 15 set-ups and 12,000 machine hours.Actual set-up cost was $26,000._____ is the static budget amount for set-ups.

• A)$26,000
• B)$38,000
• C)$21,000
• D)$25,500

---

Definitions:

Settlement

The process of concluding a transaction or dispute by all parties involved agreeing to terms, often involving the payment of funds.

Promissory Notes

Written promises to pay a specified sum of money to a named party on demand or at a determined future date.

Carrying Amount

The book value of assets and liabilities reported on the balance sheet, calculated as the original cost less any depreciation, amortization, or impairment costs.

Interest-Bearing

Referring to a financial instrument or account that generates interest income over time.