Assume that wages expense is a variable cost and that the relevant range is 10,000 to 15,000 labor hours. Within that range, the cost is $15 per hour. What can you assume about wages expense outside this range?
What will be an ideal response?
Answers will vary
Outside the relevant range, the cost may be more or less than $15 per hour. A cost relationship or behavior that applies within a specified range may not apply outside that range.
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