Whether a Cost Behaves as a Fixed Cost or as a Variable

question 31

Multiple Choice

Whether a cost behaves as a fixed cost or as a variable cost depends upon the:

• A) activity based used.
• B) cost structure of the company.
• C) industry.
• D) significance of the dollar amount of the cost.

---

Definitions:

Errors

Mistakes or inaccuracies in financial data, documents, or processes that can affect reporting and decision-making.

Current Liabilities

Liabilities of a company that need to be settled within a year.

Total Liabilities

The combined debts and financial obligations a company owes to outside parties, recorded on the balance sheet.

Balance Sheet

A financial statement that summarizes a company's assets, liabilities, and shareholders' equity at a specific point in time, showing the balance of income and expenditure over the preceding period.