An energy, machine maintenance, indirect materials and engineering support are considered as ____________?
Correct answer: A. variable overhead cost
- A. variable overhead cost
- B. fixed overhead cost
- C. fixed batch cost
- D. variable batch costGet Executive Coaching
Explanation
Energy, machine maintenance, indirect materials and engineering support generally change with production activity, so they are classified as variable overhead costs. They are indirect costs because they cannot usually be traced economically to one product unit.
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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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