If a Company's Flexible Budget Formula Is $9

question 84

Multiple Choice

If a company's flexible budget formula is $9.50 per unit plus $69,800,what would be the total budget for evaluating operating performance if 23,850 units were sold and 28,460 units were produced?

• A) $296,375
• B) $340,170
• C) $311,235
• D) $226,575

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Definitions:

Periodic Inventory System

An inventory system that updates inventory balances after a specific period, calculating COGS by a physical count.

Unit Cost

The calculated cost to produce one unit of product, taking into account all variable and fixed costs.

LIFO Inventory Method

"Last In, First Out," an inventory costing method where the last items purchased are the first ones sold, affecting the cost of goods sold and ending inventory value.

Cost Of Goods Sold

The direct costs tied to the production of products sold by a company, including materials and labor.