For Which of the Following Businesses Would the Job Order

question 141

Multiple Choice

For which of the following businesses would the job order cost system be appropriate?

• A) Law office.
• B) Crude oil refinery.
• C) Baby formula manufacturer.
• D) Soft drink producer.

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Definitions:

Total Variable Costs

The sum of expenses that vary directly with the level of production or output, including costs for materials and labor.

Output

The amount of goods or services produced by a business, industry, or economy.

Supply Curve

A graphical representation showing the relationship between the price of a good and the amount of it that producers are willing to supply at each price level.

Total Variable Costs

The sum of all costs that vary directly with the level of production or output in the short term.