A Customer List May Be Classified as Either a Finite-Life

question 76

True/False

A customer list may be classified as either a finite-life asset or an indefinite-life asset.

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Definitions:

Variable Costs

Costs that change in proportion to the level of production or business activity.

Variable Overhead

Variable overhead refers to costs that fluctuate with production levels, such as utilities and raw materials, unlike fixed overhead costs which remain constant regardless of production volume.

Fixed Overhead

Regular, consistent expenses not directly tied to production levels, such as rent, salaries, and insurance.

Direct Labor

The wages and benefits paid to employees who are directly involved in the production of goods or services.