Costs That Result from a Company's Ownership or Use of Facilities

question 67

Multiple Choice

Costs that result from a company's ownership or use of facilities and its basic organizational structure are known as:

• A) discretionary fixed costs.
• B) committed fixed costs.
• C) discretionary variable costs.
• D) committed variable costs.
• E) engineered costs.

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Definitions:

Multiple Production

This term could refer to the operation of producing goods in multiple quantities or varieties, but it's not a standard accounting or business term. Likely, it means batch or mass production processes.

Overhead Costs

Expenses not directly tied to the production of goods or services, such as rent, utilities, and office supplies.

Support Department Costs

Costs associated with the departments that do not directly engage in manufacturing but support those who do, such as IT, HR, and maintenance departments.

Direct Labor

Refers to the work done by employees who directly contribute to the production of goods or services, such as assembling a product or providing a service.