In a CVP income statement, cost of goods sold is generally
A) completely a variable cost.
B) completely a fixed cost.
C) neither a variable cost nor a fixed cost.
D) partly a variable cost and partly a fixed cost.

Question

Quizplus · Accepted Answer

Cost of goods sold includes both variable costs (such as direct materials and direct labor) and fixed costs (such as rent and depreciation on production equipment). Therefore, it is partly a variable cost and partly a fixed cost.

In a CVP Income Statement, Cost of Goods Sold Is