Mulholland Company Manufactures Various Wooden Furniture Products

question 10

Multiple Choice

Mulholland Company manufactures various wooden furniture products. If the cost object is a product, a chair, what costs would be considered direct?

• A)manufacturing supervisor's salary
• B)depreciation on the factory building
• C)salary of the worker that glues the legs to the seat of the chair
• D)insurance on the factory

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Definitions:

Producer Surplus

The difference between the amount that producers are willing to sell a good for and the actual amount received by them after selling it.

Price Floor

A government-imposed minimum price charged for a product, above which market transactions may legally occur.

Equilibrium Price

The price at which the quantity of a good or service demanded equals the quantity supplied, naturally established in a free market.

Organizational Culture

The set of shared values, beliefs, and norms that influence the behavior and attitudes of individuals within an organization.