Costs that differ directly with the level of production are known as ________ costs.
A) fixed
B) overhead
C) opportunity
D) target
E) variable

Question

Quizplus · Accepted Answer

Variable costs are costs that change in proportion to the level of production. As production increases, variable costs increase, and as production decreases, variable costs decrease. Examples of variable costs include direct labor, raw materials, and commissions.

Costs That Differ Directly with the Level of Production Are