Calculate the U

question 46

Multiple Choice

Calculate the U.S.dollar amount allocated to the patent at January 1, 2018.

• A) $50,000.
• B) $35,000.
• C) $34,000.
• D) $32,500.
• E) $28,200.

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Definitions:

Carrying Cost

This is the total cost of holding inventory, including storage, handling, insurance, and opportunity costs.

Fixed Cost

Expenses that do not change with the level of goods or services produced by a business, such as rent, salaries, and insurance.

Variable Cost

Costs that change in proportion to the good or service that a business produces.

Inventory

The total amount of goods and materials held by a company for the purpose of resale or production.