Costs That Change as Output Changes Are

question 25

Multiple Choice

Costs that change as output changes are:

• A) variable costs.
• B) fixed costs.
• C) sunk costs.
• D) None of the statements is correct.

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Definitions:

Variable Cost

Costs that change in proportion to the level of production or sales, such as materials and labor.

Capacity

The maximum amount of work that an organization, system, or machine can produce in a given period.

Multiproduct Break-Even

An analysis used to determine the point at which total revenue equals total costs for multiple products, indicating no profit or loss.

Weighted Contribution

A calculation that assigns different weights or importance to various items or activities based on their contribution to the total.