Campbell, Inc -Refer to the Figure

question 6

Multiple Choice

Campbell, Inc., has an operating environment with considerable uncertainty. The company prepares the budget for several different volume levels.
Campbell had the following budgeted data:
$\begin{array}{llr} \text { Budgeted variable costs per unit } &\\ \text {Direct materials } &\$7.00\\ \text {Direct labour } &10.00\\ \text { Supplies } &1.00\\ \text { Indirect labour } &0.50\\ \text { Power } &0.05\\\end{array}$


$\begin{array}{l}\text { Budgeted fixed overhead for } 2011 \\\text { Supervision } & \$ 4,000 \\\text { Depreciation } & 3,000 \\\text { Rent } & 2000\end{array}$
-Refer to the figure.What are the budgeted costs for materials if 5,000 units were produced?

• A)$4,000
• B)$9,000
• C)$35,000
• D)$50,000

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Definitions:

Total Cost

The complete sum of all expenses incurred in the production of goods or services, including both fixed and variable costs.

Normal Profit

The minimum amount of profit required for a company to remain competitively active in the market; it is also the break-even point for a business.

Identical Firms

Companies within the same industry or market that offer products or services indistinguishable from one another to consumers.

Economic Profit

The difference between total revenue and total costs, including both explicit and implicit costs, reflecting the actual profitability of a firm beyond accounting profit.