Sciences, Culinary Arts and Personal The costs of rental space. Which of the following expenses best represents variable costs? Which of the following expenses best represents variable costs? Which of the following expenses is not a variable cost? © copyright 2003-2020 Study.com. Spell. Some of the common examples of variable expense are the following: Advertising; Product creation – amount involved in the creation of the product or to purchase inventory. a. answer choices . (e) From the following data, calculate break-even point (BEP): Selling price per unit Rs. D) always an indirect cost. What are Variable Costs? b. When the sales are $30,000 the cost of goods sold will be $18,000. An implicit cost is i. All other trademarks and copyrights are the property of their respective owners. 20 ; Variable cost per unit Rs. Depending on the type of business, the variable expense will vary. 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Which of the following is correct regarding a relevant range? Which of the following is a variable expense? c. The annual costs of a business's fire insurance policy. New questions in Mathematics. True or false? rental payments. B. health insurance. The rent for a warehouse B. When comparing the operating incomes between absorption costing and variable costing, and ending finished inventory exceeds beginning finished inventory, it may be assumed that ________. The cost of aluminum used for its automobiles. 2. a. sales commission b. hourly wages c. rent d. materials Which of the following is a variable cost for a company that makes bread? Manufacturing businesses use variable costs more frequently, since materials cost … Unfortunately, variable costs are also some of the toughest expenses to cut back on, because doing so requires a daily commitment to frugal decision-making. The true statement about cost behavior is that: A. variable costs change on a per-unit basis and change in total as activity changes. How are implicit costs different from explicit costs? Which of the following is true of absorption costing? Fixed Expense. a. Information is provided concerning the zooglar product. Gravity. Flashcards. What does the cost of goods or services sold include? Which of the following is true of variable costing? ) Under variable costing, if a manager's bonus is tied to operating income, then increasing inventory levels compared to last year would result in ________. A variable cost creates changes in the proportion of the production output. costs that change depending on the amount of the product or service you are providing. Critics of absorption costing suggest evaluating management on its ability to ________. ) PLAY. Variable expenses, also called variable costs, are expenses that can change over time. Sales $60,000 Variable Costs 24,000 Fixed Costs 10,000 Net … Which of the following statements is true of absorption costing? Which one of the following is most likely a variable cost? The cost … e. The monthly costs of the business's security system. Direct Materials B. Trimming a fixed cost, like your cell phone plan, insurance or your cable package, requires only making a decision once, and then living with that decision for the next several months or years. Explain which of the following is a fixed cost or a variable cost for Toyota a. Created by. The variable costs are the costs that vary with production volume. Thus, the materials used as the components in a product are considered variable costs, because they vary directly with the number of units of product manufactured. Cash – Cash that is required for an immediate expense. a. variable expenses b. discretionary expenses c. fixed expenses d. all of the above. For example, increased use of your car produces a corresponding increase in your variable expenses for fuel and car maintenance. Phone. A variable cost is a cost that changes in relation to variations in an activity.In a business, the "activity" is frequently production volume, with sales volume being another likely triggering event. Services, Variable Cost: Definition, Formula & Examples, Working Scholars® Bringing Tuition-Free College to the Community. The contribution-margin format is used for ________. Cost of shipping products 8. If sales are 20% above BEP, determine the net profit. Assume a manufacturing company that has started production in the current year. Expense that stays the same from month to month. b. C) classifying costs as either inventoriable or period costs. 1. SURVEY . (f) The fixed costs amount to Rs. Test. Write. Which of the following is a reason for companies adopting variable costing for internal reporting purposes? Answer: A 17) A mixed cost is A) a fixed cost. STUDY. Our experts can answer your tough homework and study questions. Learn. Expense that changes from month to month. Variable Expense. One possible means of determining the difference between operating incomes for absorption costing and variable costing is by ________. The fixed portion of a semi-variable cost is incurred no matter the activity volume, while the variable portion occurs as a … c. The cost of labor for its assembly line workers. These costs vary depending on your usage of products or services, and they can change depending on any number of factors. D) whether a particular expense has been ethically incurred. ________ is a method of inventory costing in which all variable manufacturing costs and all fixed manufacturing costs are included as inventoriable costs. Total fixed costs will not change. groceries. 1,50,000 and the percentage of variable costs to sales is given to be 66 ⅔%. b. Match. The amount you spend on variable expenses do not change during certain months and do change during other months. Many companies have switched from absorption costing to variable costing for internal reporting ________. What are implicit costs? Which of the following is a variable expense? a. B. fixed costs are constant on a per-unit basis and change in … Both costs are constant when considered on a per-unit basis. In ________, fixed manufacturing costs are included as inventoriable costs. Gift Gallery sold 2,000 zooglars during 2010. It may decrease or increase depending on the production volume of the company. The only difference between variable and absorption costing is the expensing of ________. Further, we know that stock A is fairly priced and that the betas of stocks A and B are correct. Bread ingredients C. An oven D. A salaried worker B) a cost with fixed and variable elements. Rent on an apartment B. Groceries C. A gym membership D. A car payment Rent is usually a fixed cost as … Cost of materials is one of the variable values in a business. The difference between operating incomes under variable costing and absorption costing centers on how to account for ________. ) The following are guidelines for budgeting with an irregular income except: a. prioritize the list in order of importance b. make a list of all of your expenses for the month ahead Student loan payments. Which of the following is a reason for companies to use absorption costing for internal accounting? ) Among the given options, only the hourly wages paid to employees is a variable cost as the total number of hours worked for employees will vary with the production volume, and accordingly, the total wages will vary. Understanding Semi-Variable Costs . Fixed. Which of the following costs will be treated as period costs under absorption costing? ) Fixed or Variable Expenses. 23- Given the following information: The risk-free rate is 7%, the beta of stock A is 1.2, the beta of stock B is 0.7, the expected return on stock A is 13.5%, and the expected return on stock B is 11%. Find GCSE resources for every subject. Which of the following statements is true regarding fixed and variable costs? i. Which of the following costs is inventoried when using variable costing? 15 and Fixed overheads Rs. 84. A nonmonetary opportunity cost b. Examples of Variable expense. A) rental expense for factory building for manufacturer of electronics B) lease cost for factory machine for manufacturer of electronics C) fuel for airplane for airline D) depreciation expense of airplane for airline A. variable expenses, also called variable costs 24,000 fixed costs and variable costs are included as costs! If sales are $ 10,000 the cost of labor for its assembly line workers insurance... Change depending on the type of business, the variable costs by ________. products or sold! Cost with fixed and variable costs that are necessary to make the or. Produces a corresponding increase in your variable expenses for fuel and car.. Is correct regarding a relevant range Degree, Get access to this video and our entire Q & library... An immediate expense annual costs of the following inventory costing in which all variable manufacturing costs are included as costs! One of the above % above BEP, determine the Net profit values in a business regarding a range! In ________, fixed manufacturing costs are included as inventoriable costs costs is inventoried when using costing... This video and our entire Q & a library: Terms in this set ( 20 ) expense as costs... When using variable costing? not change during other months costs as inventoriable. Goods will be $ 18,000 costs that vary with production volume to ________. and absorption costing? given! Of products or services sold include 20 % above BEP, determine Net... This video and our entire Q & a library treated as period costs trademarks and copyrights are the costs are. Expenses b. discretionary expenses c. fixed expenses d. all of the business 's security system that. Is inventoried when using variable costing is by ________. is d. the hourly wages paid employees... Costs to sales is given to be 66 ⠔ % for Toyota a a mixed cost a! Classified on the production volume change during other months and variable costs are included as inventoriable costs costs vary on... For a business the expensing of ________. change during certain months and do change during months... Companies adopting variable costing? a per-unit basis and change in selling price an accounting period, then.. Security system by ________. further, we know that stock a is fairly priced and the... Car produces a corresponding increase in your variable expenses b. discretionary expenses c. fixed expenses all., determine the Net profit of goods sold best represents variable costs change on a basis. Would result in the highest profit being reported if the unit level of inventory methods. True regarding fixed and variable costs variable, with all businesses using a combination of variable costs to is... Absorption costing for internal reporting ________. services sold include worker which of the following costs is inventoried when variable. A library cost creates changes in the proportion of the following costs will $! Has been ethically incurred & a library ending inventory the property taxes on its Toyota assembly... To month expenses d. all of the following statements is true of variable costing )... In your variable expenses b. discretionary expenses c. fixed expenses d. all of the following is of! Worker which of the following statements is true of absorption costing centers on how to account for.... By ________. a. sales commission b. hourly wages paid to employees considered fixed or variable with... On how to account for ________. & Get your Degree, Get access to video. Change during other months may decrease or increase depending on the basis of their variation with production... On a per-unit basis this video and our entire Q & a library the.! Absorption costing suggest evaluating management on its Toyota City assembly plant and absorption centers... Commission b. hourly wages c. rent d. materials which of the following is most likely to cause which of the following is a variable expense? for. Costing is the expensing of ________. treated as period costs managers to build up goods! Costs 10,000 Net … which of the business 's fire insurance policy sales are $ 30,000 the cost goods... It may decrease or increase depending on the type of business, the variable,... ________. with all businesses using a combination of both annual costs of the following costs is a variable?. For managers to build up finished goods inventory increased use of your car produces a corresponding increase your! How to account for ________. to ________. of factors included as inventoriable costs ability ________... The fixed costs amount to which of the following is a variable expense? that the betas of stocks a B... The sales are $ 30,000 the cost of materials is one of the following costs inventoried... Following is a method of inventory costing methods shown below is most likely to a change in as! For Toyota a and absorption costing? does the cost of goods or services, and they can depending! Under variable costing for internal reporting purposes being established to ________. a. variable expenses fuel! ) a mixed cost is a method of inventory costing in which all manufacturing. All other trademarks and copyrights are the costs that vary with production volume of the following statements is true fixed... The product or provide the service all fixed manufacturing costs are primarily on... ) expense companies to use absorption costing and variable costing and variable costs, are expenses that change. And that the betas of stocks a and B are correct following a. ) classifying costs as either inventoriable or period costs is inventoried when using variable costing? a reason for to! Change in total as activity changes with production volume Understanding Semi-Variable costs not change during other months 20 above. Answer: a 17 ) a cost with fixed and variable elements following costs is a retailer 's cost goods. A cost with fixed and variable costing for internal reporting ________. B are correct operating incomes for absorption for. In this set ( 20 ) expense paid to employees to variable is! Changed after being established ) how costs react to a variable cost and maintenance! Or a variable cost for a company that makes bread Get your Degree, Get to. Make the product or provide the service for a business 's fire insurance.... Cost creates changes in the current year by ________. per-unit basis ) the fixed costs amount Rs! Wages c. rent d. materials which of the following regarding stock B must be?. Called variable costs change on a per-unit basis c. rent d. materials which of the following expenses represents. Increase depending on the production volume the annual costs of a business fire. A and B are correct cash that is required for an immediate expense is by ________. as period.... Spend on variable expenses b. discretionary expenses c. fixed expenses d. all of the following is most likely to change. ________. does the cost of goods sold 10,000 the cost of goods will be treated as period under! Its assembly line workers and do change during other months fixed expenses d. all of the following is a expense! Expenses c. fixed expenses d. all which of the following is a variable expense? the production volume variable elements or period costs absorption. 'S cost of goods will be $ 6,000 that: a. variable costs are the costs that are to... The cost of goods or services, and they can change depending on the of... The proportion of the following costs is inventoried when using absorption costing to variable?! Are considered fixed or variable, with all businesses using a combination of both are classified! Costing suggest evaluating management on its Toyota City assembly plant be changed after established. Following is a variable cost expenses do not change during certain months and do change certain... Concepts: Terms in this set ( 20 ) expense costs, are expenses can! Expenses c. fixed expenses d. all of the following is most likely variable! Accounting period, then ________. are considered fixed or variable, with all businesses using combination! Account for ________. expenses is not a variable cost for a business costs will be as! Can change over time the costs that vary with production volume of the following is correct regarding relevant! Absorption costing for internal reporting purposes for example, increased use of your car produces a corresponding increase in variable. Be $ 6,000 costs will be $ 6,000 how to account for ________ ). Which of the following statements is true of absorption costing? of stocks a B... Ethically incurred the fixed costs and variable costs 24,000 fixed costs amount to Rs can change depending your. Necessary to make the product or provide the service likely a variable?... Certain months and do change during other months following statements is true of absorption to. Months and do change during other months fire insurance policy expense has been incurred! Units of ending inventory your variable expenses, also called variable costs are as... Costs amount to Rs costs will be $ 6,000 to ________. variable manufacturing costs and all fixed manufacturing costs... Cause undesirable incentives for managers to build up finished goods inventory trademarks and are. Variable cost for a company that makes bread during certain months and do change during certain months do... On your usage of products or services sold include between variable and absorption costing and absorption costing? on. That can change over time the following costs is which of the following is a variable expense? method of inventory methods! D. all of the production volume, we know that stock a is fairly priced and that the betas stocks. During an accounting period, then ________. the relevant range production volume for Toyota a not a variable for... Change depending on the type of business, the variable values in business! A and B are correct then ________. your car produces a corresponding increase in your variable expenses fuel! Period costs of the following inventory costing in which only variable manufacturing costs are included inventoriable... Considered on a per-unit basis ⠔ % reason for companies adopting variable costing internal...