Cool Creams Cool Creams Provided the Following Data for Number

question 31

Multiple Choice

Cool Creams Cool Creams provided the following data for number of ice creams produced and its total overhead costs for past five months:
Refer to the information provided for Cool Creams. Using the high/low method, what is the variable cost per unit?

• A) $4.50
• B) $5.50
• C) $4.75
• D) $4.32

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Definitions:

Depreciable Cost Basis

The portion of the cost of an asset that can be deducted over time for tax purposes.

Personal-Use Property

Items owned for personal enjoyment or use, such as a residence or car, that typically do not qualify for tax deductions or depreciation.

FMV

Fair Market Value is an estimate of the market value of a property or asset, based on what a knowledgeable, willing, and unpressured buyer would likely pay to a knowledgeable, willing, and unpressured seller.

§179 Expense

A section of the U.S. tax code that allows a business to deduct the full purchase price of qualifying equipment or software within the tax year.