Select the Appropriate Cost Behavior for the Following Costs Incurred

question 184

Multiple Choice

Select the appropriate cost behavior for the following costs incurred by an automobile manufacturer.
-cost of car stereos

• A)variable
• B)fixed

---

Definitions:

Franchising Relationship

A business model that involves a franchisor licensing its know-how, procedures, intellectual property, use of its business model, brand, and rights to sell its branded products and services to a franchisee.

Franchisor

A company that grants the license to third parties for them to operate a business under the franchisor's brand and business model.

Principal

The original sum of money lent or invested, excluding any profits or interest generated from it.

Commission

A fee paid to an agent in a transaction, typically calculated as a percentage of the sale price.