Reference: 06-09
Prater Company Has Provided the Following Data -The Best Estimate of the Company's Variable Operating Expense Per

question 52

Multiple Choice

Reference: 06-09
Prater Company has provided the following data: $$\begin{array} { | l | l | l | } \hline & \text { This Year } & \text { Last Year } \\\hline \text { Units sold } & 300,000 & 250,000 \\\hline \text { Sales revenue } & \$ 1,300,000 & \$ 1,050,000 \\\hline \text { Less cost of goods sold } & 910,000 & 735,000 \\\hline \text { Gross margin } & 390,000 & 315,000 \\\hline \text { Less operating expenses } & 272,000 & 260,000 \\\hline \text { Net income } & \$ 118,000 & \$ 55,000 \\\hline\end{array}$$
-The best estimate of the company's variable operating expense per unit is

• A)$4.17.
• B)$0.91.
• C)$0.96.
• D)$0.24.

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Definitions:

Work Sampling

A technique for estimating the proportion of time spent on various tasks within a job, based on random samples of worker activities.

Task Times

The duration required to complete specific tasks or operations, often analyzed for process improvement and labor planning.

Time-study Methods

Techniques used to determine the time required for a worker to perform each task of a job, aiming at increasing efficiency.

Observers

Individuals or systems that watch, monitor, or record activities or events in a given context, often for the purpose of data collection or analysis.