Which of the following statements is true of cost?
A) Cost is the difference between gross margin and operating expenses.
B) Cost and price are always same for the owner of a company.
C) Cost is a dollar measure of the resources used to achieve a given benefit.
D) Cost is the revenue per unit.

Question

Quizplus · Accepted Answer

Cost is a dollar measure of the resources used to achieve a given benefit. It is not the same as price, which is the amount charged to a customer for a product or service. Cost includes all expenses incurred in the production or provision of a product or service, including materials, labor, and overhead. Gross margin is the difference between revenue and cost, while operating expenses are costs incurred in the day-to-day operations of a business. Therefore, option A is incorrect. Option B is also incorrect as cost and price can differ for a company owner. Option D is incorrect as revenue per unit is a measure of income, not cost.

Which of the Following Statements Is True of Cost