Solve the Problem. -The Total Cost to Produce MP3 Players in 2 Models

question 70

Multiple Choice

Solve the problem.
-The total cost to produce MP3 players in 2 models is given by where red model is x and the green one is y. If a total of 60 players must be made, how should production be allocated so that the total cost is minimized?

• A) 60 red players and 0 green players
• B) 30 red players and 30 green players
• C) 0 red players and 60 green players
• D) 59 red players and 1 green players

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Definitions:

Direct Labour Costs

Costs that can be directly attributed to the production of goods or services, such as wages for workers manufacturing a product.

Variable Overhead Spending Variance

The difference between the actual variable overhead costs incurred and the expected costs based on a predetermined standard.

Variable Manufacturing Overhead Cost Incurred

The variable expenses directly related to the manufacturing process, such as materials and labor, that change with production levels.

Total Variable Overhead Variance

The difference between the actual variable overhead costs incurred and the standard variable overhead costs expected for the actual production level.