COST ACCOUNTING
BREAK EVEN POINT
|
Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
|
Insurance is usually a fixed cost because
|
|
Every business needs insurance
|
|
|
The Gecko says so
|
|
|
This expense does not change relative to a firm’s sales
|
|
|
It is typically a large expense.
|
Explanation:
Detailed explanation-1: -Examples of fixed costs are rent and lease costs, salaries, utility bills, insurance, and loan repayments.
Detailed explanation-2: -Fixed cost refers to the cost of a business expense that doesn’t change even with an increase or decrease in the number of goods and services produced or sold.
Detailed explanation-3: -Your health insurance, car insurance, life insurance, and homeowners or renters insurance are also examples of fixed costs.
Detailed explanation-4: -Typical fixed expenses include car payments, mortgage or rent payments, insurance premiums and real estate taxes. Typically, these expenses can’t be easily changed.
There is 1 question to complete.