Use the Following Information for Questions
EI Greco Corporation

question 65

Multiple Choice

Use the following information for questions
EI Greco Corporation began operations on January 1, 2011.Presented below is selected information related to EI Greco at December 31, 2011. $$\begin{array} { l r l r } \text { Equipment } & € 145,000 & \text { Utilities Expense } & € 18,000 \\\text { Cash } & 42,000 & \text { Accounts Receivable } & 41,000 \\\text { Service Revenue } & 324,000 & \text { Wages Expense } & 121,000 \\\text { Rent Expense } & 39,000 & \text { Notes Payable } & 48,000 \\\text { Accounts Payable } & 22,000 & \text { Dividends } & 45,000 \\\text { Share Capital } & 84,000 & \text { Wages Payable } & 8,000 \\\text { Supplies } & 15,000 & \text { Advertising Expense } & 20,000\end{array}$$
-Net income (loss) reported on the income statement for the month of December is

• A) \(€ 126,000\)
• B) \(€ 90,000\)
• C) \(€ 81,000\)
• D) \(€ 48,000\)

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Definitions:

Marginal Costs

The expense involved in the production of an additional unit of a product or service.

Average Total Cost

The total cost of production (fixed and variable costs combined) divided by the total number of units produced.

Fixed Cost

refers to a business expense that remains constant regardless of the level of production or sales, such as rent or salaries.

Total Cost

The aggregate of every expense related to the creation of services or goods, taking into account both constant and fluctuating costs.