Mark Is an Engineer Who Has Designed a Telecommunications Device

question 32

Multiple Choice

Mark is an engineer who has designed a telecommunications device. He is convinced that there is a big potential market for the device. Accordingly, he has decided to quit his present job and start a company to manufacture and market the device.
-The cost of the raw materials that will be used in manufacturing the computer board is:

• A) a sunk cost
• B) a fixed cost
• C) a period cost
• D) a variable cost

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Definitions:

Operating Activities

These refer to the primary revenue-generating activities of a business, such as sales of goods or services, and related expenses.

General Partnership

A business arrangement where two or more individuals agree to share all assets, profits, financial, and legal liabilities of a jointly-owned business.

Legal Entities

Organizations that have legal rights and obligations, including the ability to enter into contracts and own assets.