If the number of units are 3000 and the per unit price is $500, then the flexible budget variable will be _______?
Correct answer: A. $1,500,000
- A. $1,500,000
- B. $2,500,000
- C. $3,500,000
- D. $4,500,000
Explanation
The flexible budget amount for a variable item is units multiplied by the per-unit price: 3,000 × $500 = $1,500,000. Hence, option a is correct.
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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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