A Cost That Changes as a Result of Changing Activitiesor

question 174

Multiple Choice

A cost that changes as a result of changing activitiesor levels of activities is called which of the following?

• A)product cost.
• B)department cost.
• C)batch cost.
• D)differential cost.

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Definitions:

Operating Expenses

The day-to-day costs involved in running a business, excluding the cost of goods sold.

Net Sales

Sales revenue minus returns, allowances, and discounts.

Cost Of Goods Sold

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

Acid-Test Ratio

A financial metric that measures a company's ability to pay off its current liabilities with its quick assets, which exclude inventory.