A Step Cost

question 76

Multiple Choice

A step cost:

• A)is a fixed cost over the relevant range and a variable cost everywhere else.
• B)contains both fixed and variable components.
• C)increases in direct proportion to changes in activity.
• D)is fixed over some range of activity.

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Definitions:

Purchases

The total amount of goods and materials acquired by a business for resale or production within an accounting period.

Cost of Goods Available

The total cost of a company's inventory that is available for sale during a certain period.

Net Purchases

The total purchases minus returns, allowances, and discounts.

Beginning Inventory

The financial value of stock prepared for transaction at the start of a bookkeeping period.