Accounting 9706 · AS & A Level · Costs and cost behaviour

Costs and cost behaviour — practice question

One company produces and sells only one product at $50 per unit. The variable cost is $16 per unit. Fixed costs are absorbed using a normal activity level of 1000 units at $4 per unit. What profit will be made under marginal costing if the company produces and sells 2000 units?

  • A$32000
  • B$60000
  • C$64000
  • D$68000

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