A cost that has both a fixed and variable component is called a:
A) step-fixed cost.
B) step-variable cost.
C) semivariable cost.
D) discretionary cost.

Question

Quizplus · Accepted Answer

A cost that has both fixed and variable components is called a semivariable cost. Step-fixed costs are fixed costs that increase in response to specific volume steps, while step-variable costs are variable costs that increase in response to specific volume steps. Discretionary costs are optional costs that a company incurs if it chooses to do so. Therefore, the correct answer is C, semivariable cost.

A Cost That Has Both a Fixed and Variable Component