Calgary Doughnuts Had Sales of $300 Million in 2007

question 8

Multiple Choice

Calgary Doughnuts had sales of $300 million in 2007. Its cost of sales were $200 million. If sales are expected to grow at 15% in 2008, compute the forecasted costs using the percent of sales method.

• A) $210 million
• B) $215 million
• C) $225 million
• D) $230 million

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Definitions:

Renewable Energy Sources

Forms of energy that are replenished naturally and can be used repeatedly, such as solar, wind, hydroelectric, and geothermal energy.

U.S. Electricity

The network of power generation, transmission, and distribution systems serving as the energy provider for consumers in the United States.

Total Cost

The sum of fixed cost and variable cost.

Extraction Cost

The expenses associated with the removal of raw materials from the earth, such as mining or drilling.