The Franklin Co

question 153

Multiple Choice

The Franklin Co. is analyzing a proposed project. The company expects to sell 3,500 units, give or take 15 percent. The expected variable cost per unit is $6 and the expected fixed costs are
$15,500. Cost estimates are considered accurate within a plus or minus 5 percent range. The
Depreciation expense is $6,000. The sales price is estimated at $21 a unit, give or take 3 percent.
The company bases their sensitivity analysis on the base case scenario
What is the contribution margin under the base case scenario?

• A) $14.55
• B) $14.82
• C) $15.00
• D) $15.45
• E) $15.63

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Definitions:

Ovaries

Female reproductive organs in which eggs (ova) are produced, along with key hormones like estrogen and progesterone.

Endometrium

The mucous membrane lining the interior of the uterus, which thickens during the menstrual cycle in preparation for possible implantation of an embryo.

Oogenesis

The process of egg cell development in females, beginning with the differentiation of germ cells into primary oocytes and ending with the formation of a mature ovum.

Secondary Oocyte

A cell that results from the division of a primary oocyte and goes on to become an ovum after completion of meiosis.