Use the Information Given Below to Answer the Following Questions

question 13

Multiple Choice

Use the information given below to answer the following questions:
Gum Ltd maintains subsidiary ledgers for debtors and creditors. At 1 July 2011, debtors owed $4000, and $7200 was owing to creditors. Transactions for year ended 30 June 2012 were as follows:
$$\begin{array} { l r } \text { }&\$\\\text { Credit sales } & 14000 \\\text { Cash sales } & 3000 \\\text { Credit purchases } & 23000 \\\text { Cash purchases } & 1500 \\\text { Cash received from debtors } & 11000 \\\text { Cash paid to creditors } & 25000\end{array}$$
-What was the balance of the creditors control account at 30 June 2012?

• A) $5200
• B) $5500
• C) $6000
• D) $9200

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Definitions:

Fixed Costs

Costs that do not vary with the quantity of output produced, such as rent or salaries.

Economic Profit

The difference between total revenue and total cost, including both explicit and implicit costs, representing excess earnings over the opportunity cost of capital.

MR Curve

The marginal revenue curve, which shows how the revenue from selling one more unit of a good or service changes as the quantity sold changes.

Economic Losses

Occurs when a company's total costs exceed its total revenues, indicating that the business is not efficiently allocating its resources.