Which of the Following Is Most Likely a Variable Cost

question 149

Multiple Choice

Which of the following is most likely a variable cost for a firm?

• A) the interest payments made on equipment loans
• B) an annual payment for insurance on the firm's plant
• C) the monthly rent on office space that it leased for 5 years
• D) the payments made to match workers' 401K contributions

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Definitions:

Balance Sheet

Financial report presenting the total assets, liabilities, and equity of a company at a certain date, used to assess its financial stability and operational efficiency.

Assets

Assets are resources owned by a company that have economic value and can be used to meet debts, commit to investments, or generate income.

Liabilities

Future sacrifices of economic benefits that the entity is presently obliged to make to other entities as a result of past transactions or events.

Income Statement

A financial document that reports a company's financial performance over a specific period, detailing revenues, expenses, and net income or loss.