Harold Brown Runs a Company That Sells Encyclopedia Sets for $250

question 178

Multiple Choice

Harold Brown runs a company that sells encyclopedia sets for $250. The following schedule indicates the number of sets per week that are sold as employment increases.
If Brown's costs increase by $1,300 per week as additional workers are employed, how many workers should be employed in order to maximize profit?

• A) five
• B) six
• C) seven
• D) eight

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Definitions:

Income Tax Expense

The total amount of income tax that a company calculates it owes for a specific period.

Provincial Income Tax

The tax levied by a provincial government on the income of individuals and organizations within its jurisdiction, varying from province to province.

Federal Income Tax Payable

Liabilities owed to the federal government for income taxes that have been incurred but not yet paid.

Direct Method

An accounting approach for the cash flow statement that lists major classes of gross cash receipts and payments.