A step cost:
A)is a fixed cost over the relevant range and a variable cost everywhere else.
B)contains both fixed and variable components.
C)increases in direct proportion to changes in activity.
D)is fixed over some range of activity.

Question

Quizplus · Accepted Answer

A step cost is a fixed cost over a certain range of activity and then jumps to a higher fixed cost when the activity level exceeds that range. Therefore, it is fixed over some range of activity.

A Step Cost