Assume Air Tec Manufactures Only One Component for the Air

question 63

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:
$\begin{array}{llcc} &\text { \$ }\\ \text { Direct material} &500000 \\ \text {Direct labour } &150000\\ \text { Manufacturing overhead } &220000\\ \text { Administrative expenses } & 97000\\\end{array}$

If there were 1000 units in beginning inventory,calculate the cost of sales for Air Tec for 2013.

• A)$72 500
• B)$145 000
• C)$217 500
• D)$725 000

---

Definitions:

Cattle

Domesticated bovine animals raised for their meat (beef), milk, or hides, or as working animals.

Absolute Advantage

The capability of a party to produce a greater quantity of a good, product, or service than competitors, using the same amount of resources.

Tractors

Heavy vehicles designed for agricultural use, primarily to mechanize farming tasks including plowing, planting, and harvesting.

Opportunity Cost

Forfeiting possible rewards from various alternatives when a singular option is chosen.