Jarvix Company, Which Has Only One Product, Has Provided the Following

question 28

Multiple Choice

Jarvix Company, which has only one product, has provided the following data concerning its most recent month of operations:
$\begin{array}{l|r|}\hline \text { Selling price } & \$ 111 \\\hline \text { Units in beginning inventory } & 0 \\\hline \text { Units produced } & 8,800 \\\hline \text { Units sold } & 8,900 \\\hline \text { Variable costs per unit: } & \\\hline \text { Direct materials } & \$ 34 \\\hline \text { Direct labour } & \$ 37 \\\hline \text { Variable manufacturing overhead } & \$ 3 \\\hline \text { Variable selling and administrative } & \$ 9 \\\hline \text { Fixed costs: } &\\\hline \text { Fixed manufacturing overhead } & \$ 61,600 \\\hline \text { Fixed selling and administrative } & \$ 169,100 \\\hline\end{array}$ The company produces the same number of units every month, although the sales in units vary from month to month. The company's variable costs per unit and total fixed costs have been constant from month to month.


-What was the unit product cost for the month under variable costing?

• A) $74.
• B) $81.
• C) $83.
• D) $90.

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Definitions:

Required Rate of Return

The minimum annual percentage earned that an investment must generate to avoid loss to the investor.

Present Value

The current value of a future amount of money or stream of cash flows given a specified rate of return.

Cash Inflows

The total amount of money entering a company, typically from operations, financing, and investing activities.

Rate of Return

A measure of the profitability of an investment, indicating the percentage of invested money gained or lost relative to its initial cost.