The Following Production and Average Cost Data for Two Levels

question 71

Multiple Choice

The following production and average cost data for two levels of monthly production volume have been supplied by a company that produces a single product: The best estimate of the total cost to manufacture 1,200 units is closest to:

• A)$68,520
• B)$100,920
• C)$111,720
• D)$90,120

---

Definitions:

Allocating

The process of assigning or distributing resources or costs among various accounts, projects, or entities.

Residual Income

The amount of income that an individual or company has after all personal debts and expenses, including the cost of capital, have been paid.

Performance Measure

Criteria or benchmarks used to assess and compare the efficiency, effectiveness, and productivity of operations within an organization.

Investment Turnover

A measure of a company's ability to generate sales from its investments in assets, typically indicating efficiency.