Select the Appropriate Type of Fixed Cost for Each Cost

question 198

Multiple Choice

Select the appropriate type of fixed cost for each cost listed below.
-Cost of leasing

• A)Discretionary
• B)Committed

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Definitions:

Merchandise Available for Sale

The total quantity of goods that a retailer has on hand and ready to sell to customers.

Beginning Inventory

The value of all inventory held by a company at the start of an accounting period.

Merchandise Inventory

Goods that a retail or wholesale company intends to sell to customers for a profit, listed as a current asset on the balance sheet.

Current Asset

An asset that is expected to be converted into cash, sold, or consumed within a year or the operating cycle, whichever is longer.