If Total Fixed Costs Are $25 000 What Is the Per

question 62

Multiple Choice

If total fixed costs are $25 000 what is the per unit overhead cost for R Co if 5000 units are produced? Assume units of production are used as the basis for applying overhead to product.

• A) $50
• B) $5
• C) $0.50
• D) $0.05

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Definitions:

Guaranty

A type of contract which ensures that a third party is secondarily liable for the debt to be paid; similar to a suretyship.

Liable

Being legally responsible for something, typically entailing a legal obligation to compensate for harm caused.

Artisan's Lien

A legal claim or right granted to craftsmen or repairers over the property they have serviced or improved, until payment is received.

Judicial Lien

A lien obtained by a creditor upon a debtor's property, granted by a court judgment, to secure payment of a debt.