If Variable Cost of Goods Sold Totaled $90,000 for the Year

question 52

Multiple Choice

If variable cost of goods sold totaled $90,000 for the year (18,000 units at $5.00 each) and the planned variable cost of goods sold totaled $86,400 (16,000 units at $5.40 each) , the effect of the quantity factor on the change in variable cost of goods sold is:

• A) $10,800 decrease
• B) $10,800 increase
• C) $10,000 increase
• D) $10,000 decrease

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Definitions:

Efficiency

Relates to the degree of effectiveness with which resources (time, money, effort) are utilized to achieve a goal or perform a task.

Speed of Thought

The rapidness with which one can process information, make decisions, and formulate ideas.

Continuously

Occurring without interruption or cessation.

Discontinuously

In a manner that is not continuous or consistent; occurring in separate parts or intervals.