M Studios Retails Their Own Brand of Camera That They

question 54

Multiple Choice

M Studios retails their own brand of camera that they manufacture in their plant for $500. The plant capacity is 1,000 units per month and variable costs are $225 per camera. Total fixed costs for the year are $2.16 million. If fixed costs increase by 10%, what will be the net income at full capacity?

• A) $85,000
• B) $75,000
• C) $80,000
• D) $77,000
• E) $75,500

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Definitions:

Delegator

One who delegates his or her duties under a contract to another, called the delegatee.

Assign Contract Rights

The act of transferring one's rights and obligations under a contract to another party.

Sale of Goods

The transaction of exchanging commodities for money between two parties, under regulated legal conditions.

Assignment Prohibited

A clause or condition in an agreement that restricts the transfer of rights or delegation of duties to another party.