Which of the following statements is correct about fixed costs? a. Fixed costs vary on per unit basis as well as in total as the level of activity changes b. Fixed costs remain the same on per unit basis but vary in total as the level of activity changes c. Fixed costs vary in total as the level of activity changes d. Fixed costs vary on per unit basis but remain the same in total as the level of activity

Which of the following statements is correct about fixed costs? a. Fixed costs vary on per unit basis as well as in total as the level of activity changes b. Fixed costs remain the same on per unit basis but vary in total as the level of activity changes c. Fixed costs vary in total as the level of activity changes d. Fixed costs vary on per unit basis but remain the same in total as the level of activity

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter2: Building Blocks Of Managerial Accounting

Section: Chapter Questions

Problem 14MC: Which of the following statements is true regarding average fixed costs? A. Average fixed costs per...

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Fixed costs are expenses that ______________________________ . A. vary in response to changes in activity level B. remain constant on a per-unit basis C. increase on a per-unit basis as activity increases D. remain constant as activity changes
Variable costs are costs that: A.vary inversely proportional with changes in activity B.Remain constant as activity changes C.Decrease on a per unit basis as activity increases D.Remain constant on a per unit basis as activity changes
When the level of activity increases, total fixed costs a. decrease. b. remain the same. c. increase. d. change, but the direction depends on the specific situation.
What is the term used to describe costs that increase in steps? A. Variable costs B. Fixed costs C. Mixed costs D. Semi-fixed costs
Which of the following statements is true regarding average fixed costs? Select one: a. Average fixed costs per unit fall as the level of activity rises. b. Average fixed costs per unit cannot be determined. c. Average fixed costs per unit remain fixed regardless of level of activity. d. Average fixed costs per unit rise as the level of activity rises.
Variable costs are costs that: a) Vary inversely proportional with changes in activity b) Remain constant as activity changes c) Decrease on a per unit basis as activity increases d) Remain constant on a per unit basis as activity changes
(a) Variable Costs are costs that change in direct proportion to changes in activity level. (b) Unit variable cost remain constant regardless of the level of activity a. Both statements are true b. Both statements are false c. Statement A is true and statement B is false d. Statement A is false and statement B is true
Variable costs are costs that vary, in total, in direct proportion to changes in volume or level of activity. A True B False
Within the relevant range, if there is a change in the level of the cost driver then a. Total fixed costs and total variable costs will change b. Totalfixed costs and total variable costs will remain the same C. Total fixed costs will remain the same and total variable costs will change d. Total fixed costs will change and total variable costs will remain the same.
In describing the cost formula equation Y = a + bX, which of the following statements is NOT correct? (A As "X" increases "Y" increases. (B) "X" is the level of activity. In the high-low method, "b" equals change in activity divided by change in costs. "a" is the fixed component.
Variable costs are costs that O a) vary in total directly and proportionately with changes in the activity level. b) remain the same per unit at every activity level. c) neither of the above. O d) both (a) and (b) above.
Within the relevant range, the change in activity level will result in a. A change in both of total fixed costs and total variable costs. b. A change in total variable cost and no changes in total fixed costs. c. No changes in either total fixed costs or total variable costs. d. A change in total fixed cost and no changes in total variable costs.