Which of the Following Is Most Likely to Be a Variable

question 55

Multiple Choice

Which of the following is most likely to be a variable cost for a firm?

• A)the interest payments made on equipment loans
• B)an annual payment for insurance on the firm's plant
• C)the monthly rent on office space that it leased for 5 years
• D)the payments made to match workers' 401K contributions

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Definitions:

Accumulated Depreciation

The total amount of depreciation expense that has been recorded for an asset since it was put into use.

Financing Activities

Transactions that result in changes in the size and composition of the equity capital or borrowings of a company, reflected in its statement of cash flows.

Operating Activities

Daily activities of a business related to producing and delivering its products and services, which generate the majority of a company's cash flow.

Investing Activities

Part of the cash flow statement that shows the inflow and outflow of cash from activities related to investments like securities, equipment, or properties.