Quiz 19: Cost Behavior and Cost-Volume-Profit Analysis

Business

Ethical Considerations An ethical consideration involves an act of informing a prospective investor about all possible information in the prospectus. Further, it involves highlighting all the major risk factors in the prospectus in a simple language. The act of Edward Seymour shall be considered unethical. This is due to following reasons -: 1. All risk information is not highlighted; 2. The information on increased project cost is not given in simple language thereby misleading small investors.

Total variable costs vary in direct proportion to changes in the level of activity. Unit variable costs remain the same with changes in the level of activity.

The costs which alter with the change in production are called variable costs. The costs which remain constant despite of change in production are called fixed costs. All costs cannot be segregated into fixed or variable. Some costs are semi- variable or mixed in nature; that is variable as well as fixed. Table showing classification of costs img

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