Considering two fiscal years 2013 and 2014, the actual units sold in 2013 and 2014 are 11000 and 12500 units respectively, and selling price in year 2013 is $50, then revenue effect of growth will be _________?
Correct answer: B. $75,000
- A. $70,000
- B. $75,000
- C. $65,000
- D. $73,000
Explanation
The growth effect uses the increase in units sold valued at the earlier selling price: (12,500 − 11,000) × $50 = $75,000. The calculation isolates volume growth and excludes any change in selling price.
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About Cost Accounting
Cost accounting measures and analyses the cost of producing goods or providing services for planning, control and pricing decisions. It covers direct and indirect costs, fixed and variable costs, job and process costing, break-even analysis, marginal costing, overhead allocation, and the difference between product cost and period cost.
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