Which of the following describes a variable cost?
A)Variable cost are always indirect costs.
B)Variable costs increase in total when the actual level of activity increases.
C)Variable costs include most personnel costs and depreciation on machinery.
D)Variable costs can always be traced directly to the cost object.

Question

Quizplus · Accepted Answer

Variable costs increase in total when the actual level of activity increases. This means that the cost varies depending on the amount of product or service being produced or sold.

Which of the Following Describes a Variable Cost