Solve
-Business People Are Concerned with Cost Functions, Revenue Functions $R ( x )$

question 164

Multiple Choice

Solve.
-Business people are concerned with cost functions, revenue functions, and profit functions. Suppose the revenue $R ( x )$ for $x$ units of a product can be described by $R ( x ) = 410 x$ , and the cost $C ( x )$ can be described by $C ( x )$ $= 2900 + 110 x$ . Find the profit $P ( x )$ for $x$ units.

• A) \(P ( x ) = \frac { 300 } { x } - 2900\)
• B) \(\mathrm { P } ( \mathrm { x } ) = 300 \mathrm { x } + 2900\)
• C) \(P ( x ) = 300 x - 2900\)
• D) \(P ( x ) = 520 x - 2900\)

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Definitions:

Predetermined Overhead Rate

A rate calculated before a production period that estimates the amount of manufacturing overhead cost per unit of allocation base, used to apply overhead costs to goods produced.

Casting Department

A specific section within a manufacturing facility where the process of casting—shaping material by pouring it into a mold and allowing it to solidify—is performed.

Machine-Hour

A unit of measure for the operational time of machinery, critical for calculating production costs and efficiency in a manufacturing context. This is essential in allocating costs based on the usage duration of machinery.

Predetermined Overhead Rate

A rate calculated before the period begins, used to allocate overhead costs to products or services based on a certain activity base.