Which of the Following Is Characteristic of Discretionary Fixed Costs

question 20

Multiple Choice

Which of the following is characteristic of discretionary fixed costs?

• A)They cannot be easily changed.
• B)They often involve a long-term contract.
• C)They can be easily changed by management.
• D)They increase as output increases.

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Definitions:

Credit

An accounting entry that increases a liability or equity account or decreases an asset or expense account, reflecting the opposite of a debit.

Basic Accounting Equation

Assets = Liabilities + Stockholders’ Equity.

Assets

Resources owned by a business or individual that have economic value and can be converted into cash.

Liabilities

Financial obligations owed by a business to others, such as loans, accounts payable, mortgages, deferred revenues, or bonds.