The Two Main Types of Operating Expenses Are

question 126

Multiple Choice

The two main types of operating expenses are:

• A)production and general and administrative
• B)production and selling
• C)selling and general and administrative
• D)office and selling
• E)maintenance and production

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Definitions:

Average Costs

The total costs divided by the number of units produced, giving a per unit cost average.

Total Variable Cost

The sum of all costs that vary with output level, including materials, labor, and other costs that increase with production volume.

Relevant Range

The range of activity within which the assumptions about fixed and variable cost behavior are valid.

Average Costs

The total costs (fixed and variable) divided by the total quantity produced, representing the cost per unit of production.