Question

Required: A number of costs and measures of activity are listed below. For each item, indicate whether the cost is MAINLY fixed or variable with respect to the measure of activity listed next to it. Cost Description Insurance on a warehouse building at a computer retailer 1. Measure of Activity Cost Behavior Number of items stocked Click to select Computers produced Click to selectio points 2. Cost of solder used in making computers 3. Cost of heating an electronics store Dollar sales Click to select- eBook 4. Cost of testing materials used in a medical lab Tests run Click to selecti 5. Cost of electricity for production equipment at a surfboard manufacturer Surfboards produced Print Click to select 6. Cost of alrplane fuel at a regularly scheduled commuter airline Number of passengers Click to selecti References Dollar sales Click to select) Surfboards produced Click to select 7. Sales commissions at a cellphone' dealer Cost of renting production equipment on a monthly basis at a surfboard manufacturer 9. Cook's wages at a coffee shop 10. Shift manager's wages at a coffee shop Dollar sales Click to select Dollar sales Click to select)

Answer 1

Ans.

	Cost Description	Measures of Activity	Cost Behaviour
1	Insurance on a warehouse building at a computer retailer	Number of Items Stocked	Fixed
2	Cost of solder used in making computers	Computer Produced	Variable
3	Cost of heating and electonic store	Dollar sales	Fixed
4	Cost of testing materials used in a medical lab	Tests run	Variable
5	Cost of electricity for production equipment at surfboard manufacturer	Surfboards produced	Variable
6	Cost of airplane fuel at a regularly scheduled commuter airline	Number of Passengers	Fixed
7	Sales commissions at a cell phone dealer	Dollar sales	Variable
8	Cost of renting production equipment on a monthly basis at a surfboard manufacturer	Surfboards produced	Fixed
9	Cook's wages at a coffee shop	Dollar sales	Fixed
10	Shift manager's wages at a coffee shop	Dollar sales	Fixed