The Rule of 78s Is Used to Calculate the _____ When

question 80

Multiple Choice

The Rule of 78s is used to calculate the _____ when an installment loan is paid off early.

• A) annual percentage rate (APR)
• B) balance due
• C) prepayment penalty
• D) basic cost of money
• E) amount saved

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Definitions:

Variable Manuf. Overhead

Expenses associated with manufacturing that vary directly with the level of production output, such as materials and utilities.

Standard Variable Overhead Rate

A predetermined rate applied to estimate the variable overheads based on a specific activity base.

Standard Hours Per Unit

The estimated time required to produce one unit of a product under standard operating conditions.

Actual Output

The real quantity of goods or services produced by a company, as opposed to estimated or planned production levels.