How Are Fixed Costs Represented Graphically

question 62

Multiple Choice

How are fixed costs represented graphically?

• A)a horizontal line, staying the same irrespective of the level of activity.
• B)starting at zero and increasing as a straight line as activity increases.
• C)starting at a given point and increasing as a straight line as activity increases.
• D)the intersection of the total costs and total revenue lines.

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Definitions:

Expenses

Money spent or cost incurred in an organization's efforts to generate revenue, representing the cost of doing business.

Miscellaneous Expense

Minor or incidental expenses that do not fit into other specific categories within an organization's financial accounting.

Adjusted Trial Balance

A list of all accounts and their adjusted balances after journal errors have been corrected and adjustment entries made, used to prepare financial statements.