What Are the Two Types of Costs That Should Be

question 44

Multiple Choice

What are the two types of costs that should be taken into consideration when understanding the cost driver?

• A)cost of goods sold and operating expenses
• B)cost of startup and cost of operations
• C)cost of pre-startup and cost of operations
• D)employee costs and infrastructure costs

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Definitions:

Intangible Asset

A non-physical asset having value due to its intellectual or proprietary characteristics, such as patents, trademarks, and goodwill.

Amortized

The gradual reduction of a debt through regular payments that cover both interest and principal over time.

Finite Life

The limited time span during which an asset is expected to be useful in the operations of a business, after which it becomes obsolete or non-functional.

Amortized

This refers to the process of gradually paying off a debt through regular payments over a set period, factoring in both principal and interest.