Table 12-28 -Refer to Table 12-28

question 101

Multiple Choice

Table 12-28
$$\begin{array} { | l | c | } \hline & \begin{array} { c } \text { Billions of } \\\text { Dollars }\end{array} \\\hline \text { GDP } & \$ 3,250 \\\hline \text { Depreciation } & 300 \\\hline \text { Retained } & \\\text { earnings } & 1,000 \\\hline \begin{array} { l } \text { Personal } \\\text { income }\end{array} & 2,500 \\\hline \begin{array} { l } \text { Transfer } \\\text { payments }\end{array} & 50 \\\hline\end{array}$$
-Refer to Table 12-28.Based on the table above,what is national income for this economy?

• A)$1,950 billion
• B)$2,250 billion
• C)$2,950 billion
• D)$3,550 billion

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Definitions:

Conversion Costs

The combined costs of direct labor and manufacturing overheads incurred to convert materials into finished goods.

Cost of Goods Manufactured

The total production cost of goods completed during a specific period, including costs related to direct materials, direct labor, and manufacturing overhead.

Total Factory Overhead Cost

Total factory overhead cost includes all indirect costs associated with manufacturing, such as utilities, maintenance, and salaries of non-direct labor, that are not directly tied to the production of specific goods.

Direct Labor

The labor costs associated with workers who are directly involved in the production of goods or services.