(Table: Oil Production) Refer to the Table

question 70

Multiple Choice

(Table: Oil Production) Refer to the table. What are the fixed costs ofproduction for this firm?

• A)$34
• B)$4
• C)$30
• D)$50

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Definitions:

Standard Labour Hours

The predetermined amount of labor time that is expected to be necessary to produce one unit of a product or complete a process.

Material Price Variance

The difference between the actual cost of materials and the standard cost, multiplied by the quantities purchased.

Standard Quantity

The preset amount of materials or inputs theoretically required to produce a single unit of product under normal operating conditions.

Materials Price Variance

The difference between the actual cost of materials used in production and the standard cost of those materials.