Which of the Following Is Not an Accurate Budgeted Amount

question 104

Multiple Choice

Which of the following is not an accurate budgeted amount for an output level of 90,000 units?

• A) Total overhead cost, $86,900
• B) Total manufacturing costs, $183,150
• C) Direct materials, $39,375
• D) Direct labor, $49,500

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Definitions:

Marginal Cost

The escalation in aggregate cost that comes from generating one more unit of a product or service.

Fixed Cost

Costs that do not change with the amount of goods or services produced by a business.

Variable Cost

Costs that vary directly with the level of production or volume of output.

ATC Curve

The ATC (Average Total Cost) Curve is a graphical representation of how a firm's average total costs vary with output level, highlighting the cost efficiency of producing goods.