Refer to the Following Figure to Answer the Following Questions

question 157

Multiple Choice

Refer to the following figure to answer the following questions.

-Which of the quantity (Q) and price (P) combinations in the accompanying figure represents the market at competitive equilibrium?

• A) (15,$10)
• B) (15,$6)
• C) (22,$8)
• D) (30,$6)
• E) (30,$10)

---

Definitions:

Conversion Costs

Combined costs of direct labor and manufacturing overheads incurred to convert raw materials into finished products.

FIFO Method

An inventory valuation method where the first items acquired are the first ones sold, used to calculate the cost of goods sold and ending inventory.

Direct Materials Costs

The expenses incurred for raw materials that are directly involved in the manufacturing of products.

FIFO Method

A stock rotation system where the oldest stock (first in) is used or sold first (first out).