If Fixed Costs for a Company Are $65 000 and Variable

question 15

Multiple Choice

If fixed costs for a company are $65 000 and variable costs are 20% of sales, what do total sales need to be to achieve a target net profit of $35 000?

• A) $80 000
• B) $100 000
• C) $125 000
• D) $500 000

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Definitions:

Cost Reconciliation Report

A report that outlines the differences or reconciliations between the cost of goods manufactured and the cost of goods sold.

Costs Accounted For

The total costs identified and recorded for a specific period or project, including both direct and indirect expenses.

Costs Added

Refers to any additional expenses incurred during the production or acquisition of goods and services, typically encompassing materials, labor, and overhead costs that were not initially budgeted or anticipated.

Job-Order Costing

A cost accounting system that assigns costs to specific production batches or jobs, often used for custom orders.