Better Bonds Provided the Following Data -Refer to the Figure

question 14

Multiple Choice

Better Bonds provided the following data:
$$\begin{array} { l r } \text { Sales } & \$ 540,000 \\\text { Variable costs } & \$ 378,000 \\\text { Fixed costs } & \$ 120,000 \\\text { Expected production and salesin units } & 40,000\end{array}$$
-Refer to the Figure.What is the break-even point in sales dollars?

• A)$112,500
• B)$150,000
• C)$171,429
• D)$400,000

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Definitions:

Raw Materials

Basic materials and substances used in the initial stages of production or manufacturing.

Month

A unit of time, typically comprising 28 to 31 days, used as a measure for organizing calendar time.

Underapplied Overhead

A situation in cost accounting where the allocated manufacturing overhead cost is less than the actual overhead incurred.

Manufacturing Overhead

All indirect costs associated with manufacturing, including maintenance, utilities, and indirect labor.