If the Market Price Was $9 A)10
B)11
C)12
D)13
E)14

question 55

Multiple Choice

If the market price was $9.50, how many units should the perfectly competitive firm depicted below produce in order to maximize profits? $$\begin{array} { l l } \text { Quantity } & \text { Total Cost } \\\hline 10 & \$ 50.00 \\11 & \$ 57.00 \\12 & \$ 66.00 \\13 & \$ 7.00 \\14 & \$ 90.00\end{array}$$

• A)10
• B)11
• C)12
• D)13
• E)14

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Definitions:

FIFO Method

A method of inventory valuation where the oldest items are sold first, standing for "First In, First Out."

Conversion Costs

The combined costs of direct labor and manufacturing overhead used to convert raw materials into finished products.

FIFO Method

A method of inventory valuation that assumes the first items placed in inventory are the first sold, hence, the cost of the oldest inventory is used to determine the cost of goods sold.

Process Costing

A costing method used where similar products are produced continuously, allocating production costs based on the process or department.