Use Estimation to Select the Best Response

question 31

Multiple Choice

Use estimation to select the best response. Do not calculate. A $49,000 30-year loan at
10% + 1.5 points + $150 origination fee
Would require what monthly income for the buyer?

• A) $4,000
• B) $13,750
• C) $425
• D) $1,250
• __________ (A, B, C or D)

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Definitions:

Cost of Goods Sold

The immediate expenses linked to the manufacture of goods a company sells, which covers both materials and workforce.

Material

Substances or components that are used in the production or manufacturing of goods.

Underapplied Overhead

Happens when the overhead costs assigned to manufacturing are lower than the overhead expenses that were actually incurred.

Actual Overhead

Actual overhead refers to the direct costs actually incurred by a business for operations, including utilities, rent, and maintenance expenses.