A Business Operated at 100% of Capacity During Its First

question 103

Multiple Choice

A business operated at 100% of capacity during its first month and incurred the following costs: If 1,000 units remain unsold at the end of the month and sales total $150,000 for the month, what is the amount of the manufacturing margin that would be reported on the absorption costing income statement?

• A)$50,000
• B)$54,000
• C)not reported
• D)$70,000

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Definitions:

Supply

The total amount of a specific good or service that is available to consumers, often influenced by price, production capabilities, and other market factors.

Leather

A durable and flexible material created by tanning animal rawhide and skins.

Supply

The total amount of a product or service that is available for purchase at any given time.

Demand

The amount of a product or service buyers are prepared and capable of buying at a specific price.