Which Item Would Not Be Classified as an Operating Expense

question 40

Multiple Choice

Which item would not be classified as an operating expense?

• A)Interest expense.
• B)Rent expense.
• C)Depreciation.
• D)Repairs and maintenance.

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Definitions:

Average Fixed Cost

Fixed production charges (remaining constant irrespective of output size) partitioned by the amount of production.

Average Total Cost

Average total cost is the total cost of production divided by the total quantity produced, representing the cost per unit of output produced.

Marginal Cost

The increase in total cost that arises from an extra unit of production, which is crucial for decision-making on the quantity of production and pricing.

Total Cost

Total cost is the complete amount of money it takes to produce a good or service, including both fixed and variable costs.