Mitchell Wright Group Expects to Generate Sales of $5,950,000 for Fiscal

question 34

Multiple Choice

Mitchell Wright Group expects to generate sales of $5,950,000 for fiscal 2019; sales were $3,450,000 in fiscal 2018.Assume the following figures for the fiscal year ending 2018: cash $70,000; accounts receivable $250,000; inventory $400,000; net fixed assets $520,000; accounts payable $235,000; and accruals $155,000.Use the percentage-of-sales method to forecast accounts payable for the fiscal year ending 2019.

• A)$212,036
• B)$405,290
• C)$619,619
• D)$155,000

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Definitions:

Marginal Revenue

The additional income generated from selling one more unit of a good or service, crucial in determining the most profitable level of production.

Average Total Cost (ATC)

The sum of all the production costs divided by the quantity of output produced, representing the per unit cost of production.

Average Variable Cost (AVC)

The total variable costs of production divided by the quantity of output produced, indicating the average cost of producing each unit excluding fixed costs.

Marginal Cost (MC)

The expense incurred from manufacturing an extra unit of a product or service.