Thompson Company Makes and Sells Power Tools

question 18

Multiple Choice

Thompson Company makes and sells power tools.The budgeted sales are $450,000, the budgeted variable costs are $150,000, and the budgeted total fixed cost is $230,000.What is the budgeted operating income?

• A) $73,000
• B) $227,500
• C) $70,000
• D) $84,500
• E) $567,000

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Definitions:

Bank of the United States

A historically significant financial institution in the United States, established in 1791 and 1816 in two iterations, intended to serve as a repository for federal funds and as the government's fiscal agent.

Article I, Section 8

A section of the United States Constitution that outlines the enumerated powers of Congress, including the authority to tax, regulate interstate commerce, and maintain armed forces.

Necessary and Proper

A clause in the U.S. Constitution granting Congress the power to pass all laws deemed necessary and proper for carrying out its enumerated powers.

XYZ Affair

A diplomatic incident between France and the United States in 1797-98, which led to an undeclared naval war, caused by French demands for bribes from American negotiators.