Select the Appropriate Classification of Each of the Costs Listed

question 119

Multiple Choice

Select the appropriate classification of each of the costs listed below.Each classification may be used more than once, and it is possible that one or more of the classifications may not be used at all.
-Steel used in production

• A)Variable cost
• B)Fixed cost

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Definitions:

Short Run

A period in which at least one factor of production is fixed, allowing limited adjustments to production or operational levels.

Variable Costs Per Unit

The costs that vary directly in proportion to changes in the level of production or sales volume.

Activity

A task, action, or operation performed in a business or industrial context, often contributing to a larger set of operations.

Committed Fixed Costs

Expenses that a company has an obligation to pay, regardless of the level of production or sales activity, such as rent, insurance, and salaries.