Variable Costs Are Costs That Remain Constant on a Per-Unit

question 51

True/False

Variable costs are costs that remain constant on a per-unit basis as the level of activity changes.

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Definitions:

Direct Method

A cash flow statement preparation method that lists specific cash inflows and outflows relating directly to operations.

Inventory Increase

Occurs when the ending inventory is greater than the beginning inventory, reflecting a net addition to stock through purchases or production.

Accounts Payable

Short-term liabilities of a business that are due to be paid to creditors within a specified period.

Cost of Goods Sold

The direct costs attributable to the production of the goods sold by a company, including material and labor.