If each motorcycle requires a belt that costs $20 and 2,000 motorcycles are produced for the month, the total cost for belts is ________.
A) considered to be a direct fixed cost
B) considered to be a direct variable cost
C) considered to be an indirect fixed cost
D) considered to be an indirect variable cost

Question

Quizplus · Accepted Answer

The cost of the belt is directly tied to the production of the motorcycles, making it a direct cost. Additionally, the cost varies with the number of motorcycles produced, making it a variable cost. Therefore, the best choice is B - considered to be a direct variable cost.

If Each Motorcycle Requires a Belt That Costs $20 and 2,000