Gage Company Reports the Following Information for Its First Year

question 127

Multiple Choice

Gage Company reports the following information for its first year of operations:
$\begin{array}{ll}\text { Units produced this year } & 7,000 \text { units } \\\text { Units sold this year } & 6,500 \text { units } \\\text { Direct materials } & \$ 22 \text { per unit } \\\text { Direct labor } & \$ 30 \text { per unit } \\\text { Variable overhead } & ? \text { in total } \\\text { Fixed overhead } & \$ 56,000 \text { in tota }\end{array}$

If the company's cost per unit of finished goods using variable costing is $63,what is total variable overhead?

• A) $21,000
• B) $71,500
• C) $77,000
• D) $19,500
• E) $16,590

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Definitions:

Maslow's Hierarchy

A theory in psychology proposed by Abraham Maslow, presenting a hierarchy of human needs, from basic physiological needs to more complex psychological needs and self-actualization, influencing human motivation.

Physiological

Relates to the normal functioning of living organisms and their parts, including all physical and chemical processes.

Primary Drives

Basic, innate motivations that are necessary for survival, such as hunger, thirst, and avoidance of pain.

Homeostasis

The process by which living organisms regulate their internal environment to maintain a stable, constant condition in response to external changes.