Cost Behavior

Question 1

Fixed cost

Answer 1

cost remains the same over a period of time (rent)

Question 2

Variable

Answer 2

cost changes in proportion to the change in the
level of activity (material cost)

Question 3

Semi Variable / Semi Fixed

Answer 3

part of it is fixed, part of it is variable (sales rep
remuneration)

Question 4

Stepped Fixed

Answer 4

cost is fixed up to a certain point after which it
increases in step fashion (supervisors salaries)

Question 5

For Fromulas Check Page

Answer 5

pg 43 of manual!