The lump sum cost that remains unchanged in total despite of changes in total volume is classified as __________?
Correct answer: C. fixed overhead cost
- A. unchanged price
- B. unchanged cost
- C. fixed overhead cost
- D. variable overhead costFinance
Explanation
A fixed overhead cost remains constant in total within the relevant activity range, even when production volume changes. Variable overhead, in contrast, changes in total with activity.
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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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