Bumper Earned Net Income of $72,000 and Has Fixed Costs

question 40

Multiple Choice

Bumper earned net income of $72,000 and has fixed costs of $36,000.Bumper sold 11,000

• A)$96,000; 25%
• B)$120,000; 40%
• C)$270,000; 27%
• D)$162,000; 45%

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Definitions:

Average Sale Period

The average time it takes for a company to complete a sales cycle from the initial contact to the final sale.

Average Sale Period

A financial metric that calculates the average time it takes for a company to sell its inventory, indicating the efficiency of sales and inventory management.

Average Collection Period

The average number of days it takes for a business to receive payments owed by its customers, indicating the efficiency of the company’s credit and collection policies.

Current Ratio

A measure of a business's capability to meet its obligations due in less than one year, focusing on its short-term financial health.