Use the Table Below to Answer the Following Questions

question 107

Multiple Choice

Use the table below to answer the following questions.
Table 12.2.3

-Refer to Table 12.2.3 which gives the total cost schedule for Brenda's Balloon Shop, a perfectly competitive firm. The average variable cost of producing the 1st balloon is

• A)$1.00.
• B)$4.00.
• C)$2.00.
• D)$4.80.
• E)$3.00.

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Definitions:

Unfavorable Materials Price

A variance that occurs when the actual price paid for materials exceeds the standard or expected cost, impacting profits negatively.

Quantity Variances

Quantity variances refer to the difference between the actual and planned (or standard) quantity of input used in production, affecting cost control and operational efficiency.

Efficiency Standard

A benchmark for measuring the productivity and performance of operations, often aiming to minimize waste and maximize output.

Volume Standard

A benchmark measure of quantity, used to gauge efficiency or capacity in production and operations.