Mantel Incorporated Began Producing Its New Line of Dolls at Its

question 79

Multiple Choice

Mantel Incorporated began producing its new line of dolls at its Connecticut plant in December of year 0.In year 1,it produced 30,000 dolls at a total cost of $385,000.In year 2,its production increased to 80,000 dolls at a total cost of $885,000.Assuming the cost structure was the same for both years,what must be the variable cost (c) and the fixed cost (F) per doll?

• A)F is less than $80,000,and c is greater than $7.
• B)F is greater than $60,000,and c is less than $5.
• C)F is less than $100,000,and c is greater than $9.
• D)F is greater than $110,000,and c is less than $6.

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Definitions:

Bridal Salon

A specialized retail store that sells bridal wear, including wedding dresses and accessories.

Liquidate

To convert assets into cash or cash equivalents by selling them on the open market.

Channel Richness

The capacity to communicate and understand information between people and organizations.

Communicate

The process of sharing or exchanging information, thoughts, or feelings between people through speaking, writing, or using some other medium.