English Corporation Analyzed the Relationship Between Total Factory Overhead and Changes

question 22

Multiple Choice

English Corporation analyzed the relationship between total factory overhead and changes in direct labor hours.It found the following:
Y = $6,000 + $6X
The Y in the equation is an estimate of

• A) total variable costs.
• B) total direct labor hours.
• C) total factory overhead.
• D) total fixed costs.

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Definitions:

Cost Of Goods Sold

Financial obligations directly arising from the manufacturing of a company’s products, including material and labor costs.

Stockholders' Equity

The residual assets of a company that belong to shareholders after all liabilities have been subtracted, representing ownership interest.

Return On Assets

An overall measure of profitability; computed by dividing net income by average total assets.