Given the Units of Measure for Production and the Units

question 2

Multiple Choice

Given the units of measure for production and the units of measure for cost or revenue. Write a sentence interpreting the marginal as an increase. Revenue is given by hundred dollars when q thousand units are sold; .

• A) When 16 thousand units are sold, revenue is increasing by $0.30 per unit.
• B) When 16 thousand units are sold, revenue is decreasing by $0.30 per unit.
• C) When 16 thousand units are sold, revenue is increasing by $30 per unit.
• D) When 16 thousand units are sold, revenue is decreasing by $30 per unit.
• E) When 16 thousand units are sold, revenue is increasing by $3 per unit.

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Definitions:

Income Summary

An account used in the closing process that summarizes revenues and expenses for a period, transferring the net amount to retained earnings.

Sales Returns

Transactions where customers return defective, unsatisfactory or unwanted products back to the seller, resulting in a reversal of revenue.

Accounts Receivable

Financial obligations of customers towards a business for delivered but unpaid goods or services.

Operating Cycle

The duration of time it takes for a company to buy inventory, sell it to customers, and collect the cash from sales.