Samson,Inc How Much Was the Unit Cost Per Service? (Round Your

question 112

Multiple Choice

Samson,Inc.reported the following information for the year: $$\begin{array} { | l | r | } \hline \text { Service Revenue } & \$ 40,000 \\\hline \text { Operating Expenses } & 22,500 \\\hline \text { Net Income } & 17,500 \\\hline \text { Number of Services Provided for the Year } & 12,000 \\\hline\end{array}$$
How much was the unit cost per service? (Round your answer to the nearest cent.)

• A) $3.33
• B) $1.46
• C) $1.88
• D) $5.21

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Definitions:

Selling Expense

Costs incurred directly and indirectly in making sales; these can include advertising, sales staff salaries, and commissions.

Periodic Inventory Method

An accounting method that updates inventory and cost of goods sold figures at the end of an accounting period, not at each sale.

Cost Of Merchandise Sold

The total cost incurred to purchase or produce the goods that have been sold to customers during a specific period.

Gross Profit

The difference between revenue and the cost of goods sold, indicating the amount before deducting operating expenses.