A) costs that are not worth the effort to trace to a specific cost object.
B) costs that change, in total, in direct proportion to changes in activity levels.
C) always irrelevant.
D) costs that remain constant no matter the activity level.
70) A cost is $50,000 when 25,000 units are produced, and $100,000 when 50,000 units are produced. This is an example of a(n):
A) fixed cost.
B) direct cost.
C) variable cost.
D) indirect cost.
71) A cost is $50,000 when 25,000 units are produced, and $50,000 when 50,000 units are produced. This is an example of a(n):
A) fixed cost.
B) direct cost.
C) variable cost.
D) indirect cost.
72) What determines the difference between a variable and a fixed cost?
A) Whether the total cost changes when activity levels change.
B) Whether the total cost is relevant to a particular decision.
C) Whether the total cost can be traced to a specific cost object.
D) Whether the total cost is related to manufacturing or nonmanufacturing activities.
73) Which of the following is an example of a variable cost for a manufacturing firm?
A) The cost of rent on the factory.
B) The cost of factory supervision.
C) The cost of raw materials.
D) The cost of depreciation on equipment.
74) Fixed costs are:
A) costs that are not worth the effort to trace to a specific cost object.
B) costs that change, in total, in direct proportion to changes in activity levels.
C) always irrelevant.
D) costs that remain constant, in total, no matter the activity level.
75) A fixed cost:
A) goes up in total when activity increases.
B) goes up per unit when activity increases.
C) goes down in total when activity increases.
D) goes down per unit when activity increases.
76) A relevant cost is a cost that:
A) has the potential to influence a decision.
B) changes in direct proportion to changes in activity level.
C) can be traced to a specific cost object.
D) is used for control purposes.