Horton and Associates Produces Two Products Named BigBlast and LittleBlast

question 73

Multiple Choice

Horton and Associates produces two products named BigBlast and LittleBlast. Last month 4,000 units of BigBlast and 1,000 units of the LittleBlast were produced and sold. Following are average prices and costs for last month: The production lines for both products are highly automated, so large changes in production cause very little change in total direct labor costs. Workers who are classified as direct labor monitor the production line and are permanent employees who regularly work 40 hours per week. All costs other than "corporate fixed costs" listed under each product line could be avoided if the product line were dropped.
The following qualitative factors are relevant to Horton's decision.

• A) I only
• B) I and III only
• C) I, II, and III
• D) II and III only

---

Definitions:

Deductive Reasoning

A logical process whereby a conclusion is reached based on the concordance of multiple premises that are generally assumed to be true.

Top-Down

An approach or process that starts from the upper levels of a hierarchy and moves downwards, often referring to management, processing, or information systems.

Bottom-Up

An approach or process that starts from the most basic or elementary level and works upwards in complexity, typically used in decision-making, problem-solving, and information processing contexts.

Theoretical

Pertaining to an abstract system of ideas or principles used to analyze or explain something.