Hubba Company Has a Current Production Capacity Level of 200,000

question 60

Multiple Choice

Hubba Company has a current production capacity level of 200,000 units per month.At this level of production, variable costs are $0.90 per unit and fixed costs are $0.50 per unit.Current monthly sales are 164,500 units.Bubba Company has contacted Hubba Company about purchasing 20,000 units at $2.00 each.Current sales would not be affected by the special order and no additional fixed costs would be incurred on the special order.If Hubba Company decides to accept the special order, Hubba Company's costs will increase by _____.

• A)$20,000
• B)$24,000
• C)$18,000
• D)$40,000

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Definitions:

Actin Myofilament

A protein filament that, along with myosin, plays a role in muscle contraction and cell movement.

Z Disk

A structure within the sarcomere of muscle fibers that serves as the attachment site for actin filaments, marking the boundary between sarcomeres.

Sarcomere

The structural unit of a muscle fiber, consisting of a repeating sequence of actin and myosin filaments, responsible for muscle contraction.

Actin Myofilament

A protein filament essential to muscle contraction, part of the thin filaments in muscle fibers that slide over myosin for muscle movement.