Triple M Company Had the Following Data for the Month

question 39

Multiple Choice

Triple M Company had the following data for the month:
Fixed overhead is $4,000 per month, which is applied to production on the basis of normal activity of 2,000 units. During the month, 2,000 units were produced. Loring started the month with 300 units in beginning inventory, with unit product cost equal to this month's unit product cost. A total of 2,100 units were sold during the month at price of $14 per unit. Selling and administrative expense for the month, all fixed, totalled $3,600.
$\begin{array}{lr}\text { Variable costs per unit: } & \\\text { Direct materials } & \$ 4.00 \\\text { Direct labour } & 3.20 \\\text { Variable overhead } & 1.00 \\\text { Variable selling expenses } & 0.40\end{array}$
-Refer to the Figure.What is the unit product cost under variable costing?

• A)$7.20
• B)$8.20
• C)$8.60
• D)$10.20

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Definitions:

Profit-Making Businesses

Enterprises or organizations that operate with the primary goal of earning financial profits.

Budgetary Slack

Excess resources set within a budget to provide for uncertain events.

Operational Plans

Detailed plans that outline how a strategy will be implemented in terms of day-to-day operations.

Flexible Budget

A budget that shows the expected results of a responsibility center for several activity levels.