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(Appendix 12B)Delta Railroad Has Two Operating Divisions-Freight and Passenger

question 18

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(Appendix 12B) Delta Railroad has two operating divisions-Freight and Passenger.The Maintenance Department serves both divisions.Variable Maintenance Department costs are budgeted at $12 per thousand miles.The fixed Maintenance Department costs are budgeted at $800, 000 per year.The level of the fixed Maintenance Department costs are determined by the peak-period requirements.Data for last year follow: (Appendix 12B) Delta Railroad has two operating divisions-Freight and Passenger.The Maintenance Department serves both divisions.Variable Maintenance Department costs are budgeted at $12 per thousand miles.The fixed Maintenance Department costs are budgeted at $800, 000 per year.The level of the fixed Maintenance Department costs are determined by the peak-period requirements.Data for last year follow:   During last year, the Maintenance Department actually incurred $650, 000 in variable costs and $815, 000 in fixed costs. For performance evaluation purposes, how much of the fixed Maintenance Department cost should be charged to the Freight Division at the end of the year? A) $480, 000 B) $440, 000 C) $472, 000 D) $50, 000 During last year, the Maintenance Department actually incurred $650, 000 in variable costs and $815, 000 in fixed costs. For performance evaluation purposes, how much of the fixed Maintenance Department cost should be charged to the Freight Division at the end of the year?

Understand the impact of international trade on domestic market prices and quantities.
Identify the effects of tariffs and quotas on domestic economies and global trade.
Recognize the benefits of comparative advantage and the role it plays in international trade.
Describe the consequences of trade restrictions on consumer choice and market variety.

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