An amount by which the total cost changes with respect to the change in level of activity is classified as ____________?
Correct answer: A. slope coefficient
- A. slope coefficient
- B. cost coefficient
- C. change coefficient
- D. activity coefficient
Explanation
The slope coefficient measures the change in total cost for each one-unit change in the activity level. In a cost equation, it is represented by b in y = a + bx.
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About Cost Accounting
Cost accounting measures and analyses the cost of producing goods or providing services for planning, control and pricing decisions. It covers direct and indirect costs, fixed and variable costs, job and process costing, break-even analysis, marginal costing, overhead allocation, and the difference between product cost and period cost.
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