Use the Above Table and Assume a Fixed Cost of

question 224

Multiple Choice

$$\begin{array} { c c c c c c c } & \text { Variable } & \text { Total } & & & & \text { Marginal } \\\text { Output } & \text { Cost } & \text { Cost } & \text { AFC } & \text { AVC } & \text { ATC } & \text { Cost } \\1 & 400 & & & & & \\2 & 700 & & & & & \\3 & 1,000 & & & & & \\4 & 1,400 & & & & &\end{array}$$ Use the above table and assume a fixed cost of $1000.
-At an output of 3,AVC is

• A)$250.
• B)$300.
• C)$333.
• D)$400.
• E)$667.

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Definitions:

Accumulated Depreciation

The total amount of an asset's cost that has been allocated as depreciation expense since the asset was put into use.

Contra-Asset Account

An account shown on the balance sheet that reduces the value of a related asset, used for accumulated depreciation or allowances for doubtful accounts.

Depreciation Schedule

A table detailing the periodic depreciation expense of an asset over its useful life.

Worksheet

A document that accountants use for planning and preparing adjustments, showing the results of those adjustments before preparing financial statements.