Franz Began Business at the Start of This Year and Had

question 51

Multiple Choice

Franz began business at the start of this year and had the following costs: variable manufacturing cost per unit, $9; fixed manufacturing costs, $60,000; variable selling and administrative costs per unit, $2; and fixed selling and administrative costs, $220,000. The company sells its units for $45 each. There were no variances. Planned and actual production was 10,000 units. Sales were 8,500 units. The net income (loss) under variable costing is:

• A)$(7,500).
• B)$9,000.
• C)$15,000.
• D)$18,000.
• E)$26,000.

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Definitions:

Encoding

In psychology, the process of converting information into a form that can be stored in memory, initiating the process of creating a new memory.

Selective Attention

The cognitive process of focusing on a particular object or task, while ignoring irrelevant information.

Cognitive Abilities

Mental capabilities involved in learning, reasoning, problem solving, and adapting to new situations.

Encoding

The first step of transforming data into a format that can be preserved in memory.