Using Account Analysis, What Type of Cost Is the Fee

question 18

Multiple Choice

Using account analysis, what type of cost is the fee the airline company charges for your bags assuming a typical policy is $25 if the bag weighs between 0 and 50 lbs.; $75 if the bag weighs between 50 and 75 lbs. and $125 if the bag weighs between 75 and 100 lbs?

• A)Fixed
• B)Mixed
• C)Step
• D)Variable

---

Definitions:

Insurance

Protection against financial loss from specific risks, such as accident, theft, or illness, through the transfer of risk to an insurer for a premium.

Trade-In Allowance

The amount credited to the buyer by the seller when the buyer gives a product as part of the payment for a new product.

Book Value

The net value of a company's assets as recorded on its financial statements, minus its liabilities and intangible assets.

Recorded

The process of entering financial transactions into accounting records.