M&H's Unit Production Cost Under Variable Costing Is $25, and $32

question 2

Multiple Choice

M&H's unit production cost under variable costing is $25, and $32 under absorption costing.Net income under variable costing was $250,000 and $187,000 under absorption costing last year.Production equalled 63,000 units.How many units did M&H sell?

• A)72,000
• B)54,000
• C)70,000
• D)56,000

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Definitions:

Unlevered Cost

The cost of financing a project or investment without any debt, reflecting the expenses incurred using only equity financing.

Weighted Average

A weighted average is a calculation that takes into account the varying degrees of importance of the numbers in a data set, providing a measure that reflects their contribution to the overall total.

Coupon

The interest rate stated on a bond when issued, which is typically paid at regular intervals until maturity.

Dividend Payout

The portion of net income a firm pays out to its shareholders as dividends.