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The correct option is C. SER jeans maker is designing a new line of jeans. These jeans will sell for $410 per unit and cost $328 per unit in variable costs to make Fixed out 120.000. If 5,000 units are produced and sold, income equals $290,000.
Sales (5,000×$410) = $2,050,000
Less: Variable costs (5,000×$328) = 1,640,000
Contribution margin = 410,000
Less: Fixed costs = 120,000
Net income (loss)
Variable charges are fees that alternate as the amount of the coolest or service that an enterprise produces adjustments. Variable costs are the sum of marginal expenses over all devices produced. They also can be taken into consideration regular fees. constant charges and variable charges make up the two additives of the total price. Direct costs are costs that could without problems be related to a particular value object.
But, no longer all variable fees are direct charges. for instance, variable production overhead fees are variable fees that might be indirect prices, not direct costs. Variable prices are once in a while known as unit-stage costs as they range with the range of devices produced. Direct hard work and overhead are regularly known as conversion fees, whilst direct cloth and direct labor are frequently known as top prices.
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