Alfredo’s Pizza produced and sold 1,000 pizzas last month and had total variable
ID: 2766753 • Letter: A
Question
Alfredo’s Pizza produced and sold 1,000 pizzas last month and had total variable ingredients that cost $4,575. If production and sales are expected to increase by 17% next month, which of the following statements is true?
A)
Total variable materials costs are expected to be $4,779.50.
B)
Variable material cost per unit is expected to be $4.99.
C)
Total variable materials costs are expected to be $4,345.
D)
Total variable materials costs are expected to be $5,352.75.
Alfredo’s Pizza produced and sold 1,000 pizzas last month and had total variable ingredients that cost $4,575. If production and sales are expected to increase by 17% next month, which of the following statements is true?
A)
Total variable materials costs are expected to be $4,779.50.
B)
Variable material cost per unit is expected to be $4.99.
C)
Total variable materials costs are expected to be $4,345.
D)
Total variable materials costs are expected to be $5,352.75.
Explanation / Answer
Existing variable cost for 1,000 units =$ 4,575
For sales Increase by =17%
Total variable cost will be 117% of $4,575 =$4,575 x 117%
=$5,352.75
Answer option D
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