Lacrue Inc

question 103

Multiple Choice

Lacrue Inc. has provided the following data concerning one of the products in its standard cost system. Variable manufacturing overhead is applied to products on the basis of direct labor-hours.

-The standard amount of materials allowed for the actual output is closest to:

• A) 23,310 ounces
• B) 23,300 ounces
• C) 22,687 ounces
• D) 23,940 ounces

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Definitions:

Average Fixed Cost

The fixed costs of production (costs that do not vary with output) divided by the quantity of output produced.

Economic Profit

The disparity between the aggregate income and the sum of all expenses, encompassing both direct and indirect costs.

Weekly Operating Profits

The profit a company makes from its operations in a week, excluding non-operational revenues and expenses.

Market Price

The current price at which a good or service can be bought or sold in a particular market.