Table 13-8
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​ -Refer to Table 13-8

question 230

Multiple Choice

Table 13-8
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​
$$\begin{array} { | c | c | c | } \hline \begin{array} { c } \text { Output } \\\text { (Units) }\end{array} & \begin{array} { c } \text { Fixed Cost } \\\text { (Dollars) }\end{array} & \begin{array} { c } \text { Variable Cost } \\\text { (Dollars) }\end{array} \\\hline 0 & 20 & 0 \\\hline 1 & 20 & 10 \\\hline 2 & 20 & 40 \\\hline 3 & 20 & 80 \\\hline 4 & 20 & 130 \\\hline 5 & 20 & 200 \\\hline 6 & 20 & 300 \\\hline\end{array}$$
-Refer to Table 13-8. What is the marginal cost of producing the fifth unit of output?

• A)$4
• B)$40
• C)$50
• D)$70

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Definitions:

Cost per Unit

The cost incurred for producing, storing, and selling one unit of a product, crucial for pricing and profitability analysis.

First Department

The initial stage or section in a manufacturing or production process, where the raw materials start their transformation.

First-In, First-Out

An inventory valuation method that assumes goods are sold in the order they are acquired, so the oldest inventory items are sold first.

Process Costing

A costing methodology used in industries where production is continuous, assigning costs to masses of similar units.