The Direct Material Cost Is $20,000 When 2,000 Units Are

question 150

Multiple Choice

The direct material cost is $20,000 when 2,000 units are produced. What is the direct material cost for 2,500 units produced?

• A) $15,000
• B) $ 5,000
• C) $20,000
• D) $25,000

---

Definitions:

Voting Shares

Shares that give the stockholder the right to vote on matters of corporate policy making and the election of the board of directors.

Impairment Loss

A charge recognized when the carrying amount of an asset exceeds its recoverable amount, indicating a permanent reduction in the valuation of a company's asset.

Consolidated Balance Sheet

A financial statement showing the total assets, liabilities, and shareholders' equity of a parent company and its subsidiaries as if they were a single entity.

Acquisition Differential

The difference between the cost of acquiring a company and the fair value of its identifiable net assets.