2) Given the following data, what is the total relevant cost of an internal prod

Question

2) Given the following data, what is the total relevant cost of an internal production of 50 units?

Direct material....................................$15/unit

Direct labor..........................................$3/unit

Variable overhead................................$2/unit

Avoidable fixed costs............................ $800

Unavoidable fixed costs...........................$300

Sunk costs...........................................$2,000

Select one:

A. $2,100

B. $1,800

C. $4,100

D. None of the above

3) All of the following would be classified as product costs except:

Select one:

A. property taxes on production equipment.

B. insurance on factory machinery.

C. salaries of the factory maintenance department.

D. wages of customer delivery personnel.

4) Which of the following is NOT a consequence of unethical behavior?

Select one:

A. It can lead to illegal activities

B. It can lead to destruction of the firm

C. It can lead to inferior financial performance

D. All of these answer choices are consequences of unethical behavior

Explanation / Answer

Q2 B. $1,800 Statement showing computations Particulars Amount Direct Materials = 15 *50                      750.00 Direct Labour = 3 *50                      150.00 Variable Overhead = 2*50                      100.00 Avoidable Fixed Costs                      800.00 Total relevant costs                  1,800.00 Q3 D. wages of customer delivery personnel. Q4 D. All of these answer choices are consequences of unethical behavior

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