The Change in Total Cost Associated with Each Change in the Quantity

question 60

Multiple Choice

The change in total cost associated with each change in the quantity of the cost driver is:

• A)Average cost.
• B)Controllable cost.
• C)Variable cost.
• D)Unit cost.

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Definitions:

Activity Variance

The difference between the actual cost incurred for an activity and the expected cost, based on the budgeted or standard amount.

Direct Labor

The wages paid to workers who are directly involved in the production of goods or the provision of services.

Units

Units typically refer to the individual items or quantities of a product or service produced or sold by a business.

Activity Variance

The difference between what was planned in terms of activity levels or costs and what was actually achieved.