St John's Company Incurred the Following Costs for the Months

question 217

Multiple Choice

St. John's Company incurred the following costs for the months of March and April.
$\begin{array}{lrr}\text { Type of Cost } &\text { March }&\text { April }\\\text { Insurance } & \$ 5,000 & \$ 5,000 \\\text { Utilities } & 4,000 & 5,000 \\\text { Depreciation } & 3,500 & 3,500 \\\text { Materials } & 10,000 & 20,000\end{array}$
-Refer to the Figure.Assume that output was 5,000 units in March and 10,000 units in April,utility cost is a mixed cost,and the fixed cost of utilities was $3,000.What was the variable rate per unit of output for utilities cost?

• A)$0.20
• B)$0.30
• C)$0.40
• D)$0.60

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Definitions:

Overcompensation

An excessive response or behavior in an attempt to correct a perceived weakness or fault.

General Adaptation Syndrome

A three-stage response model describing the physiological changes the body goes through under stress: alarm, resistance, and exhaustion.

Resistance

The act of opposing or withstanding; in psychology, it refers to the opposition against the uncovering of unconscious material or changing behaviors.

Fight-Flight Response

An acute stress response involving a physiological reaction that occurs in response to a perceived harmful event, attack, or threat to survival.