Use the Information Below to Answer the Following Question(s)

question 176

Multiple Choice

Use the information below to answer the following question(s) .Honda Heaven produces and sells an auto part for $20.00 per unit.Direct materials are $8 per unit, while direct manufacturing labour averages $1.50 per unit.Variable manufacturing overhead is $0.50 per unit and fixed manufacturing overhead is $250,000 per year.Administrative expenses, all fixed, run $90,000 per year, with sales commissions of $2 per part.Production is 100,000 parts per year.And this year, 75,000 boxes were sold.
-Under variable costing, which of the following expenses is inventoriable?

• A)variable manufacturing overhead
• B)direct manufacturing labour and fixed manufacturing overhead
• C)marketing and direct manufacturing labour
• D)variable manufacturing overhead and administrative
• E)variable and fixed manufacturing overhead

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Definitions:

Bankruptcy

A legal proceeding involving a person or business that is unable to repay their outstanding debts, leading to a reorganization or elimination of debt under the laws of bankruptcy.

Key Employees

Employees considered crucial to the operation and success of a business due to their skills, knowledge, or roles.

Optimal Capital Structure

The best mix of debt, equity, and other financing sources that minimizes the company's cost of capital while maximizing its value.

Debt-equity Ratio

Ratio that measures a company's financial leverage by dividing its total liabilities by its shareholder's equity, indicating the balance between debt financing and equity financing.