The Total Interest on a $10,000, 4%, 3-Month Note Receivable

question 87

Multiple Choice

The total interest on a $10,000, 4%, 3-month note receivable is

• A)$ 100.
• B)$ 200.
• C)$ 400.
• D)$1,200.

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Definitions:

Direct Labor Rate

The wage rate paid to employees directly involved in manufacturing goods or providing services, expressed per hour or per unit of output.

Time and Materials Pricing

A contract or pricing method where the customer pays the supplier based on the time spent to complete the work and the cost of materials used.

Production Capacity

The maximum amount of goods that can be produced in a given timeframe using available resources.

Contribution Margin

The amount by which sales revenue exceeds variable costs, used to cover fixed costs and generate profit.