A business received an offer from an exporter for5,000 units of product at $8 pe
ID: 2434151 • Letter: A
Question
A business received an offer from an exporter for5,000 units of product at $8 per unit. The acceptance of the offerwill not affect normal production or domestic sales prices. Thefollowing data are available:
Domestic unit sales price $12
Unit manufacturing costs:
Variable $9
Fixed $1
What is the revenue from the acceptance of theoffer?
a. $45,000
b. $40,000
c. $50,000
If the expected sales volume for the currentperiod is 7,000 units, the desired ending inventory is 200 units,and the beginning inventory is 300 units, the number of units setforth in the production budget, representing total production forthe current period, is:
a. 7,000
b. 6,900
c. 7,100
d. 7,200
Explanation / Answer
(1)5,000 X $8 = $40,000 Answer: b. $40,000 (2)7000+200-300=6900 Answer: b. 6,900
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