Barredo Corporation's Relevant Range of Activity Is 3,000 Units to 7,000

question 184

Multiple Choice

Barredo Corporation's relevant range of activity is 3,000 units to 7,000 units. When it produces and sells 5,000 units, its average costs per unit are as follows:

-If 4,000 units are sold,the total variable cost is closest to:

• A) $67,000
• B) $47,600
• C) $51,400
• D) $58,800

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Definitions:

Recovered

Refers to the process of regaining or securing an amount of money, property, or other resource that was previously lost or owed.

Profits

The financial gain obtained when the revenue generated from business activities exceeds the expenses, taxes, and costs involved in sustaining the activity.

Discounted Cash-flow Analysis

A financial model that estimates the value of an investment based on its expected future cash flows, discounted back to their present value.

Debts

Money that is owed or due, typically resulting from borrowing funds or purchasing goods and services on credit.