Which of the Following Is True of Indirect Costs

question 119

Multiple Choice

Which of the following is true of indirect costs?

• A) Indirect costs are always considered sunk costs.
• B) All indirect costs are included in cost of goods sold.
• C) Indirect costs always vary in direct proportion to the level of production.
• D) Indirect costs cannot be traced to a particular cost object in an economically feasible way.

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Definitions:

Appreciation

An increase in the value of an asset or currency over time.

Dollar

A widely used currency in international trade, often associated with the United States Dollar (USD), recognised by the symbol $.

Managed Float System

An exchange rate system in which a country's currency value is allowed to fluctuate in response to foreign exchange market mechanisms, with occasional intervention by the country's monetary authorities to stabilize the currency's value.

Exchange Rates

The value of one currency expressed in terms of another, determined by the foreign exchange market.