Based on the Following Cost Data,what Conclusions Can You Make $\quad$

question 18

Multiple Choice

Based on the following cost data,what conclusions can you make about the costs of Product A and Product B? $\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\text { Total Cost }$
$\begin{array}{lrrr}\text { Production: } & \text { Product A } & \text { Product B } \\10 \text { units } & \$ 100 & ? \\100 \text { units } & \$ 1,000& ? \\1,000 \text { units } & \$ 10,000& ?\end{array}$

$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\text { Unit Cost }$
$\begin{array}{rr}\text {Production:}&\text { Product A } & \text { Product B } \\\text { 10 units}&? & \$ 10,000 \\\text { 100 units}&? & \$ 1,000 \\\text { 1,000 units}&? & \$ 100\end{array}$

• A) The cost of Product A is a fixed cost and the cost of Product B is a variable cost.
• B) The cost of Product A is a variable cost and the cost of Product B is a fixed cost.
• C) The costs of Product A and Product B are both variable costs.
• D) The costs of Product A and Product B are both mixed costs.

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Definitions:

Consolidation Entry G

An adjusting entry made during the consolidation process to eliminate intra-group transactions and balances in the preparation of consolidated financial statements.

Intra-entity Gross Profit

Refers to the profit generated from transactions within the same company or group, not yet realized from an external party's perspective.

Consolidation Process

The method of combining the financial statements of two or more legally separate entities into one set of financial statements for the group as a whole.

Voting Common Stock

Refers to a class of shares that grants the holder the right to vote on company matters and board elections.