Isondo's TV and Appliance Store Is a Small Company That

question 124

Multiple Choice

Isondo's TV and Appliance Store is a small company that has hired you to perform some management advisory services. The following information pertains to 2015 operations.
$$\begin{array} { l r } \text { Sales (1,200 televisions) } & \$ 1,200,000 \\\text { Cost of goods sold } & 540,000 \\\text { Store manager's salary per year } & 108,000 \\\text { Operating costs per year } & 216,000 \\\text { Advertising and promotion per year } & 24,000 \\\text { Commissions ( } 3 \% \text { of sales) } & 36,000\end{array}$$
-Which cost estimation method is being used by Isondo's TV and Appliance Store?

• A) the operating costing method
• B) the marginal costing method
• C) the account analysis method
• D) the cost-volume-profit analysis method

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