Which of the Following Statements Is True for a Company

question 25

Multiple Choice

Which of the following statements is true for a company that uses variable costing?

• A) The manufacturing cost per unit decreases when the volume of production increases.
• B) Net income is not affected by fluctuations in production.
• C) Fixed manufacturing overhead is treated like a product cost.
• D) Fixed manufacturing overhead costs incurred in the current period may be recognized as expense in a later period.

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Definitions:

Cartel

An agreement among competing firms to control prices or exclude entry of a new competitor in a market, often leading to market inefficiencies and lack of competition.

Price Effect

The effect of a price change of a product or service on its supply or demand.

Oligopolist

A firm in an industry with only a small number of producers.

Monopolist

A single seller in a market who has significant control over the supply of a particular good or service, often leading to less competition and higher prices.