Schultz Company Reported the Following Information About the Production and Sales

question 92

Multiple Choice

Schultz Company reported the following information about the production and sales of its only product:

-The ending inventory under variable costing would be

• A) $48,000.
• B) $54,000.
• C) $38,400.
• D) $31,200.

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Definitions:

ATC

Average Total Cost, which refers to the total cost per unit of output produced, calculated by dividing the total cost by the quantity of output.

AVC

Average Variable Cost, which represents the variable costs of production (costs that change with output) divided by the quantity of output.

Average Total Cost

Calculated as the sum of all production costs divided by the number of units produced, representing the per unit cost of production.

Average Variable Cost

The sum of all costs that vary with output levels, divided by the total output generated.