It Costs $10 to Make a Single Unit Using Regular

question 11

Multiple Choice

It costs $10 to make a single unit using regular production and $15 to make a single unit using overtime production.Finished units sell for $17 and are built to order.The manufacturing plant has a regular production capacity of 250 units per month and no inventory at the start of the planning period.What is the BEST net cash flow for the entire planning period if the manufacturer uses a chase plan?

• A) $6,800
• B) $7,050
• C) $7,300
• D) $7,550

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Definitions:

Credited

The acknowledgment of a payment received or the addition of funds to an account.

Account

An account statement that captures all transactions associated with a specific aspect of the accounting equation.

Payment

The transfer of money from one party to another as compensation for goods or services or as repayment of a loan.

Invoice

A document issued by a seller to a buyer, detailing products or services provided, prices, and terms of payment.