Managed capacity costs differ from committed capacity costs in that:
A) Managed costs are found only in homogeneous and never in heterogeneous cost pools.
B) Managed costs are always strictly variable while committed costs are strictly fixed.
C) Managed costs will be avoided when the cost pool performs no work while committed costs will continue.
D) Managed costs are always traceable while committed costs will have to be assigned via some method of estimation.

Question

Quizplus · Accepted Answer

Managed costs can be avoided if the cost pool performs no work, meaning they are not incurred under those circumstances. In contrast, committed costs continue regardless of the level of work performed, as they are fixed costs that the company has committed to paying.

Managed Capacity Costs Differ from Committed Capacity Costs in That