A Firm Is Reviewing a Project with a Labor Cost

question 90

Multiple Choice

A firm is reviewing a project with a labor cost of $8.90 per unit,raw materials cost of $21.63 a unit,and fixed costs of $8,000 a month. Sales are projected at 10,000 units over the three-month life of the project. What are the total variable costs of the project?

• A) $216,300
• B) $297,300
• C) $305,300
• D) $313,300
• E) $329,300

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Definitions:

Aquifers

Underground layers of water-bearing rock or materials that can yield water for use.

Guano

The accumulated excrement of seabirds or bats, used historically as a highly effective fertilizer because of its high nitrogen, phosphate, and potassium content.

Limestone

A sedimentary rock composed mainly of calcium carbonate, often used in construction and as a raw material in cement production.

Aquifer

An underground layer of water-bearing permeable rock, rock fractures, or unconsolidated materials (gravel, sand, or silt) from which groundwater can be extracted using a water well.