Assume Air Tec Manufactures Only One Component for the Air

question 28

Multiple Choice

Assume Air Tec manufactures only one component for the air conditioning industry.In 2013 the company produced 12 000 units of the component of which 10 000 were sold.The following costs were recorded for 2013:

Calculate the inventoriable product cost per unit of output for Air Tec.

• A)$26.42
• B)$62.50
• C)$80.58
• D)$72.50

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Definitions:

Production Targets

These are specific goals set for the amount of products manufactured or services delivered in a certain period of time.

Cost Overrun

Occurs when the actual cost of a project exceeds the originally budgeted or estimated cost.

Irish Shamrock Model

A conceptual framework proposed by Charles Handy that describes an organization structure divided into three parts: core staff, contractual fringe, and flexible labor force.

Core Workers

Essential employees who are critical to the foundational operations and success of a business.