The true statement about cost behavior is that:
A. fixed costs are constant on a per-unit basis and change in total as activity changes.
B. variable costs are constant on a per-unit basis and change in total as activity changes.
C. variable costs are constant on a per-unit basis and are constant in total as activity changes.
D. variable costs change on a per-unit basis and change in total as activity changes.
E. fixed costs are constant on a per-unit basis and constant in total as activity changes.
Answer: B
You might also like to view...
Which of the following statements is TRUE of the Sarbanes-Oxley Act?
A) Accounting firms are allowed to provide both auditing services and a full range of consulting services to their public company clients. B) Those who commit securities fraud must be sentenced to 10 years in prison. C) All private and foreign companies must issue an internal control report evaluated by an outside auditor. D) The Public Company Accounting Oversight Board oversees the work of auditors of public companies.
Mermaid Outfitters projected sales of 78,000 units for the year at a unit sales price of $15
00. Actual sales for the year were 70,000 units at $15.00 per unit. Variable costs were budgeted at $4.50 per unit, and the actual variable cost was $4.80 per unit. Budgeted fixed costs totaled $376,000, while actual fixed costs amounted to $400,000. What is the sales volume variance for operating income? A) $39,000 unfavorable B) $84,000 unfavorable C) $84,000 favorable D) $45,000 unfavorable
Michael is the maker of a note which states that it will be due on March 10, 2015. The note contains a clause stating that "payment will be limited to the proceeds of the sale of the contents of freight car No. 1234." Is the note negotiable? Why or why not? Explain
The Immigration and Naturalization Service (INS) was enlarged and made into a Cabinet-level agency with the passage of the Patriot Act in 2002
Indicate whether the statement is true or false