Table 93 Table 93 Shows Cost Data for Lotus Lanterns, a Producer of Lanterns

question 98

Multiple Choice

Table 9.3
$\begin{array}{|c|c|c|c|c|}\hline \begin{array}{c}\text { Quantity of } \\\text { Lanterns }\end{array} & \begin{array}{c}\text { Fixed Cost } \\\text { (dollars) }\end{array} & \begin{array}{c}\text { Variable Cost } \\\text { (dollars) }\end{array} & \begin{array}{c}\text { Total Cost } \\\text { (dollars) }\end{array} & \begin{array}{c}\text { Average Total Cost } \\\text { (dollars) }\end{array} \\\hline 75 & 200 & 170 & 370 & 4.93 \\\hline 80 & 200 & 230 & 430 & 5.36 \\\hline 90 & 200 & & & 7.67 \\\hline 100 & 200 & 810 & & \\\hline 115 & 200 & & & 11.8 \\\hline 117 & 200 & 1264 & 1464 &12.5 \\\hline 120 & 200 & 1480 & & \\\hline\end{array}$
Table 9.3 shows cost data for Lotus Lanterns, a producer of whimsical night lights.
-Refer to Table 9.3.What is the variable cost of production when the firm produces 115 lanterns?

• A)$1,556
• B)$1,157
• C)$956
• D)$10.05

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Definitions:

Capital Assets

Long-term tangible or intangible assets used in operations of a business that are not intended for sale in the regular course of business.

Exchange Rates

The rate at which one currency can be exchanged for another currency.

Capital Assets (Net)

The total value of a business's long-term assets, including property, plant, and equipment, net of accumulated depreciation.

Functional Currency

The main currency used by a business entity to conduct its economic activities and financial reporting.