Maxwell Company Has a Total Expense Per Unit of $2

question 20

Multiple Choice

Maxwell Company has a total expense per unit of $2.00 per unit at the 16,000-unit level of activity, and total expense per unit of $1.95 at the 21,000-unit level of activity.
-What is the best estimate of the variable cost per unit for Maxwell Company?

• A) $0.56.
• B) $1.79.
• C) $1.95.
• D) $2.00.

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Definitions:

WACC

Weighted Average Cost of Capital; a method for assessing a firm's capital costs by applying proportional weights to each kind of capital.

Credit Rating

An evaluation of the creditworthiness of an individual or corporation, often expressed as a grade or score, that reflects the likelihood of the entity defaulting on its debts.