Exhibit 7-2 -Use the Information in Exhibit 7-2 to Calculate the Consumer

question 182

Multiple Choice

Exhibit 7-2

-Use the information in Exhibit 7-2 to calculate the consumer price index in the current year.

• A) CPI = 2
• B) CPI = 50
• C) CPI = 55
• D) CPI = 182
• E) CPI = 200

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Definitions:

Direct Materials

Raw materials that can be directly attributed to the production of finished goods in a manufacturing process.

Salesperson Commissions

Payments made to sales staff based on a percentage of the sales they generate, used as an incentive to increase sales performance.

Prime Costs

The direct costs of manufacturing, specifically direct labor and material costs.

Conversion Costs

Costs incurred during the process of converting raw materials into finished products, typically including direct labor and manufacturing overhead.