A Cost That Changes,in Total,in Direct Proportion to Changes in Activity

question 96

Multiple Choice

A cost that changes,in total,in direct proportion to changes in activity levels is a(n) :

• A)absorption cost.
• B)contribution margin.
• C)fixed cost.
• D)variable cost.

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Definitions:

Payables Manager

A financial professional responsible for managing a company's short-term liabilities and obligations to its creditors and suppliers.

Marketable Securities

Financial instruments that are easily convertible into cash within a short period, typically with high liquidity and low risk.

Use of Cash

The ways in which a business uses its cash on hand, including operating expenses, investing activities, and financing activities.

Cash Cycle

The period between the initial investment in inventory and receiving cash from the sale of goods or services, reflecting a company's efficiency and management of working capital.