Which of the Following Is an Example of a Variable

question 18

Multiple Choice

Which of the following is an example of a variable cost on an operational budget?

• A) Rent
• B) Labor
• C) Property insurance
• D) Capital equipment

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Definitions:

Denominator Activity

The level of activity used to allocate fixed costs in a costing system.

Standard Machine-Hours

A metric used to estimate the amount of machine time required for or used during production based on standard rates.

National Distribution

refers to the marketing and transportation of goods across an entire country, ensuring product availability on a nation-wide scale.

Labour Rate Variance

The difference between the actual cost of labor and the expected cost, based on standard rates and actual hours worked.