Answer the Following Questions Using the Information Below

question 166

Multiple Choice

Answer the following questions using the information below:
Queanbeyan Company incurred fixed manufacturing costs of $7200 during 2018.Other information for 2018 includes:
The budgeted denominator level is 800 units.
Units produced total 1000 units.
Units sold total 950 units.
Beginning inventory was zero.
The fixed manufacturing cost rate is based on the budgeted denominator level.Manufacturing variances are closed to cost of goods sold.
-Under absorption costing,fixed manufacturing costs expensed on the income statement (excluding adjustments for variances) total:

• A)$8550
• B)0
• C)$7200
• D)$9000

Understand how depreciation impacts cash flow and investment analysis.

Calculate and understand the significance of the cash payback method in capital budgeting.

Understand the concept of payback period and how it is calculated.

Know the differences between net present value and average rate of return methods of capital investment analysis.