Fern Valley Ltd Reports the Following Data from This Year's

question 54

Multiple Choice

Fern Valley Ltd reports the following data from this year's master budget:
$$\begin{array} { l c r } & \text { Per unit } & \text { Total } \\\text { Variable manufacturing cost } & \$ 18 & \\\text { Fixed manufacturing cost } & \$ 6 & \$ 24000 \\\text { Fixed selling and administrative expense } & \$ 2 & \$ 4000\end{array}$$
Fern Valley Ltd's capacity is 20 000 units per year, and the normal selling price is $35 per unit. A one-time-only order for 1200 units has been received at a special price of $30 per unit. The order would not disturb regular business. If the order is accepted, overall profit will increase by:

• A) $ 4 800
• B) $ 6 000
• C) $ 8 000
• D) $14 400

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Definitions:

Inductive Reasoning

A logical process in which multiple premises, all believed true, are combined to obtain a specific conclusion.

Critical Thinking

The deliberate process of judging the quality of information before accepting it.

"EatMore" Drug

Description not specific to a recognized pharmacological substance or term - NO.

Independent Variable

A variable in an experiment that is manipulated or changed by the researcher to observe its effects on the dependent variable.