At an Activity Level of 10,000 Units, Variable Costs Totalled

question 10

Multiple Choice

At an activity level of 10,000 units, variable costs totalled $35,000 and fixed costs totalled $20,800. If 16,000 units are produced and this activity is within the relevant range, then:

• A)fixed cost per unit would equal $5.58.
• B)total unit cost would equal $4.80.
• C)total costs would equal $55,800.
• D)total cost would equal $89,280.

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Definitions:

Cash Sales

Cash Sales refer to transactions where goods or services are paid for with cash immediately at the point of sale, without any delay in payment.

Credit Sales

Sales made by a business where the payment is deferred to a later date, allowing the buyer to take possession of goods or services immediately but pay later.

Collect

To gather or amass something, often refers to the act of receiving payments or debts.

Depreciation Expense

The allocated cost of a tangible fixed asset over its useful life, reflecting its use and wear and tear over time.