Briar Company Provides Cleaning Services to Commercial and Residential Customers

question 13

Multiple Choice

Briar Company provides cleaning services to commercial and residential customers.The commercial business segment provided services to 270 customers and the residential business segment provided services to 595 customers. $\begin{array}{lrrr} & \text { Commercial } & \text { Residential } & \text { Total } \\\text { Service Revenue } & \$ 87,000 & \$ 122,000 & \$ 209,000 \\\text { Variable Costs } & \underline{23,000} & \underline{51,000} & \underline{74,000} \\\text { Contribution Margin } & 64,000 & 71,000 & 135,000 \\\text { Fixed Costs } & \underline{47,000} & \underline{46,000} & \underline{93,000} \\\text { Operating Income } & \$ 17,000 & \$ 25,000 & \$ 42,000\end{array}$ State which segment has the higher average variable cost per unit and provide the amount of the average variable cost per unit for that segment.(Round the answer to the nearest dollar. )

• A)Residential,$124
• B)Commercial,$86
• C)Residential,$86
• D)Commercial,$124

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Definitions:

Motivational Theory

A concept or model that explains what motivates human behavior, often guiding strategies to increase motivation.

Maintenance Factors

In Herzberg's two-factor theory, aspects of the work environment that are necessary to prevent dissatisfaction but do not necessarily motivate employees.

Justified

Having a good reason or being shown to be right or reasonable.

Job Rotation

A workplace strategy where employees rotate between different tasks or roles to learn new skills and gain exposure to various aspects of an organization.