Use the Following Information for Questions
Truckel, Inc -The Fixed Overhead Is an Allocated Common Cost

question 75

Multiple Choice

Use the following information for questions
Truckel, Inc. currently manufactures a wicket as its main product. The costs per unit are as follows: $\begin{array}{lr}\text { Direct materials and direct labor } & \$ 11 \\\text { Variable overhead } & 5 \\\text { Fixed overhead } & 8\\\text { Total }&\$24\end{array}$
-The fixed overhead is an allocated common cost. How much is the relevant cost of the wicket?

• A) $36
• B) $24
• C) $19
• D) $16

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Definitions:

Utility

The satisfaction or benefit derived from the consumption of goods and services.

Optimal Consumption Bundles

Combinations of goods and services that provide the highest utility to a consumer given his or her preferences and budget constraints.

Sardines

Small, oily fish within the herring family of Clupeidae, often canned and eaten by humans.

Marginal Rate

Often referred to as the marginal rate of substitution or the marginal tax rate, indicating the rate at which one can trade off one good for another or the tax rate on the next dollar earned, respectively.