Table 13-7
the Following Table Shows the Production Costs for the Flying

question 161

Multiple Choice

Table 13-7
The following table shows the production costs for The Flying Elvis Copter Rides.
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$$\begin{array} { | c | c | c | c | c | c | c | c } \hline \begin{array} { c } \text { Output } \\\text { (Helicopter } \\\text { rides) }\end{array} & \begin{array} { c } \text { Total } \\\text { Cost } \\\text { (Dollars) }\end{array} & \begin{array} { c } \text { Fixed } \\\text { Cost } \\\text { (Dollars) }\end{array} & \begin{array} { c } \text { Variable } \\\text { Cost } \\\text { (Dollars) }\end{array} & \begin{array} { c } \text { Marginal } \\\text { Cost } \\\text { (Dollars) }\end{array} & \begin{array} { c } \text { Average } \\\text { Fixed Cost } \\\text { (Dollars per } \\\text { ride) }\end{array} & \begin{array} { c } \text { Average } \\\text { Variable } \\\text { Cost } \\\text { (Dollars per } \\\text { ride) }\end{array} & \begin{array} { c } \text { Avera } \\\text { Total Cost } \\\text { (Dollars } \\\text { ride) }\end{array} \\\hline 0 & 50 & 50 & 0 & - - & - & - & - \\\hline 1 & 150 & \mathrm {~A} & \mathrm {~B} & \mathrm { C } & \mathrm { D } & \mathrm { E } & \mathrm { F } \\\hline 2 & \mathrm { G } & \mathrm { H } & \mathrm { I } & 120 & \mathrm {~J} & \mathrm {~K} & \mathrm {~L} \\\hline 3 & \mathrm { M } & \mathrm { N } & \mathrm { O } & \mathrm { P } & \mathrm { Q } & 120 & \mathrm { R } \\\hline\end{array}$$ ​
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-Refer to Table 13-7. What is the value of A?

• A)$25
• B)$50
• C)$100
• D)$200

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Definitions:

Variances

Discrepancies between planned financial outcomes and the actual results, used in budgeting and accounting to analyze and control costs.

Quantity Variance

A variance that is computed by taking the difference between the actual quantity of the input used and the amount of the input that should have been used for the actual level of output and multiplying the result by the standard price of the input.

Standard Quantity

This refers to the predefined amount of materials or labor deemed necessary to produce a single unit of a product under normal operations.

Actual Quantity

The real number of units used or produced, as opposed to planned or estimated quantities.