Asked by habibatou diallo on May 04, 2024
Verified
A number of costs and measures of activity are listed below.
Required:
For each item above, indicate whether the cost is MAINLY fixed or variable with respect to the possible measure of activity listed next to it.
Fixed Cost
Costs that do not vary with the level of production or sales, such as rent, salaries, and insurance premiums.
Variable Cost
A cost that varies with the level of output or sales, such as materials and labor directly involved in production.
Measure Of Activity
A quantifiable metric used to assess the level of operation or output, often tied to performance or productivity evaluation.
- Ascertain variable and fixed costs at assorted operational levels.
Verified Answer
2. Cost of solder used in making computers; Computers produced; Variable
3. Cost of dough used at a pizza shop; Pizzas cooked; Variable
4. Janitorial wages at a surfboard manufacturer; Surfboards produced; Fixed
5. Salary of the controller at a hospital; Number of patients; Fixed
6. Cost of sales at an electronics store; Dollar sales; Variable
7. Cost of testing materials used in a medical lab; Tests run; Variable
8. Cost of heating an electronics store; Dollar sales; Fixed
9. Cost of electricity for production equipment at a surfboard manufacturer; Surfboards produced; Variable
10. Depreciation on shelving at a book store; Dollar sales; Fixed
Learning Objectives
- Ascertain variable and fixed costs at assorted operational levels.
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