For financial reporting purposes, the total amount of period costs incurred to sell 9,000 units is closest to:

A) $35,700
B) $9,000
C) $53,550
D) $44,550

Question

For financial reporting purposes, the total amount of period costs incurred to sell 9,000 units is closest to:A) $35,700B) $9,000C) $53,550D) $44,550

Jerica Jones · Accepted Answer

Final Answer : C, Explanation :  Period costs are expenses that are not directly related to the production of goods or services, but are necessary to run the business. Examples of period costs include selling, general and administrative expenses. To determine the total amount of period costs incurred to sell 9,000 units, we need to know the total amount of period costs incurred during the period in question. The question does not provide this information, so we cannot calculate the answer exactly. However, we can make an estimate based on the options provided.Option A: $35,700Assuming that the period costs are $3.97 per unit ($35,700 ÷ 9,000 units), this option could be the answer. However, we have no information to confirm this assumption.Option B: $9,000This option cannot be the answer as it represents the cost of producing 9,000 units (i.e. product costs) rather than the period costs to sell them.Option C: $53,550Assuming that the period costs are $5.95 per unit ($53,550 ÷ 9,000 units), this option could be the answer.Option D: $44,550Assuming that the period costs are $4.95 per unit ($44,550 ÷ 9,000 units), this option could be the answer.Based on the given options, option C ($53,550) is the closest estimate to the total amount of period costs incurred to sell 9,000 units.   Reference: CH01-Ref22Mark is an engineer who has designed a telecommunications device.He is convinced that there is a big potential market for the device.Accordingly, he has decided to quit his present job and start a company to manufacture and market the device.

For financial reporting purposes, the total amount of period costs incurred to sell 9,000 units is closest to:

A) $35,700
B) $9,000
C) $53,550
D) $44,550

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