The Lease Cost of Office Computers Is a _____ for an Accounting

question 208

Multiple Choice

The lease cost of office computers is a _____ for an accounting firm.

• A) variable cost
• B) discretionary fixed cost
• C) committed fixed cost
• D) semi-variable cost

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Definitions:

Allocation Base

A criterion or measure used for distributing overhead costs among various cost objects, such as machine hours, labor hours, or units produced.

Machine-Hours

A measure of production volume expressed in the total number of hours that machines are operated.

Departmental Predetermined Overhead Rates

Rates used to allocate overhead costs to products, calculated in advance for each department based on estimated overheads and activity levels.

Machine-Hours

An index of manufacturing productivity determined by the total hours of machine operation.