Franco Company Has Variable Costs of $0

question 1

Multiple Choice

Franco Company has variable costs of $0.65 per unit of product.In October,the volume of production was 24,000 units and units sold were 23,000.The total production costs incurred were $32,200.What are the fixed costs per month?

• A) $16,600
• B) $17,250
• C) $8,400
• D) $15,600

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Definitions:

Faulty Production Methods

Refer to manufacturing or production processes that have defects, inefficiencies, or errors, leading to substandard products or increased production costs.

Poor Handling

Inadequate or careless management of items, which often results in damage or loss.

Spoiled

Usually refers to goods or materials that have become unfit for use or consumption due to damage, deterioration, or passing their expiration dates.

Unfit for Use

Refers to a condition where an item, equipment, or facility is not suitable or safe for its intended purpose.