Table 12-4 Table 12-4 Shows the Short-Run Cost Data of a Perfectly

question 292

Multiple Choice

Table 12-4

Table 12-4 shows the short-run cost data of a perfectly competitive firm. Assume that output can only be increased in batches of 20 units.
-Refer to Table 12-4.If the market price is $45, the firm

• A)will earn a profit of $3,600.
• B)will suffer a loss of $200.
• C)will break even.
• D)will earn profit of $1,040.

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Definitions:

Perpetual Inventory System

An accounting method that records the sale or purchase of inventory immediately through the use of computerized point-of-sale systems and enterprise asset management software.

Sales Revenue

The total income received by a company from its sales of goods or services, before any expenses are subtracted.

FIFO

An inventory valuation method where goods first purchased or produced are the first to be sold, standing for First-In, First-Out.

Perpetual Inventory System

A perpetual inventory system is a method of accounting for inventory that records sales and purchases of goods in real-time through an inventory management system, offering accurate and up-to-date stock levels.