The Alfonso Company Is Analyzing a Project with Expected Sales

question 305

Multiple Choice

The Alfonso Company is analyzing a project with expected sales of 4,000 units, give or take 5 percent. The expected variable cost per unit is $9 and the expected total fixed costs are $17,000.
Cost estimates are considered accurate within a plus or minus 2 percent range. The depreciation
Expense is $3,000. The sale price is estimated at $18 a unit, give or take 5 percent. Sensitivity
Analysis is based on the most likely scenario.
What is the contribution margin under the best case scenario?

• A) $9.00
• B) $9.18
• C) $9.90
• D) $10.08
• E) $10.26

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Definitions:

Postural Muscles

Muscles that are primarily responsible for stabilizing the body and maintaining posture.

Breathing Rate

The number of breaths taken per minute, which can vary based on factors such as physical activity, emotional state, and overall health.

Heart Rate

The number of heartbeats per unit of time, typically expressed in beats per minute (bpm), indicating the heart's efficiency in circulating blood throughout the body.

Brain Activity

The electrical and metabolic phenomena occurring within the brain that are associated with functional operations and processes.