Use This Information for Rusty Co

question 217

Multiple Choice

Use this information for Rusty Co. to answer the questions that follow.
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Rusty Co. sells two products, X and Y. Last year, Rusty sold 5,000 units of X and 35,000 units of Y. Related data are as follows:
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-What was Rusty Co.'s unit variable cost of the overall product E?

• A) $52.50
• B) $70.00
• C) $120.00
• D) $50.00

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Definitions:

Compensating Balance

A minimum account balance that a firm agrees to maintain in a bank account, often used to secure a loan or line of credit.

Accounts Payable

Short-term liabilities representing amounts owed by a company to suppliers or creditors for goods and services received but not yet paid for.

Factoring

A financial transaction and a type of debtor finance where a business sells its accounts receivable to a third party (the factor) at a discount.

Net Working Capital

measures a company's short-term financial health by subtracting its current liabilities from its current assets, indicating the liquidity available to fund day-to-day operations.