Carlton Corporation Sells a Single Product at a Selling Price

question 167

Multiple Choice

Carlton Corporation sells a single product at a selling price of $40 per unit. Variable expenses are $22 per unit and fixed expenses are $82,800. Carlton's break-even point is:

• A)4,600 units
• B)3,764 units
• C)5,000 units
• D)2,070 units

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Definitions:

Equivalent Units

A calculation used in process costing that converts partially completed units into a number of fully completed units, facilitating cost analysis.

FIFO Method

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

Cost Reconciliation

The process of verifying the accuracy of cost data by comparing input costs with output costs, ensuring that all costs are accounted for.

Process Inventory

Process inventory, also known as work-in-process inventory, represents goods that are partially completed in the manufacturing process but are not yet finished products.