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Commerce · Q411

Costing

Graduate and Post Graduate · Commerce · question 411

Q411

If slope coefficient is 0.60 and difference in machine hours is 50000, then difference in cost can be

A.
$68,700
B.
$58,700
C.
$30,000
Answer
D.
$83,333.34

Answer: Option C

Solution

Answer: Option C
Solution:
Slope coefficient = Difference in costs ÷ Difference in machine hours
Difference in cost = Difference in machine hours × Slope coefficient
= 50000 × 0.60 = $30,000
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