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

question 42

Multiple Choice

Use the information below to answer the following question(s) .Blackoil Corp.has two divisions, Refining and Production.The company's primary product is Clean Oil.Each division's costs are provided below:
The Production Division is able to sell the oil to other areas for $24 per litre.The Refining Division has been operating at a capacity of 80,000 litres a day, using oil from the Production Division and oil purchased from other suppliers.The Refining Division usually purchases 50,000 litres of oil, on average, from the Production Division and 30,000 litres, on average, from other suppliers at $40/litre.
-What is the Production Division's operating income per 200 litres of oil reported under the 175% of variable costs method?

• A)$1,500
• B)$880
• C)$100
• D)$(100)
• E)$1,200

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Definitions:

Skinner

B.F. Skinner, an American psychologist, is known for his work in developing the theory of behaviorism and for his invention of the operant conditioning chamber.

Stimulus-Stimulus Learning

A type of learning where an association is formed between two stimuli, leading to a new learned response.

Two-Factor Theory

A psychological theory proposing that emotion is based on two factors: physiological arousal and cognitive label of the arousal, proposed by Stanley Schachter and Jerome E. Singer.