The costs incurred for the acquisition of short-run activity capacity, usually as the result of yearly planning are called:
A)Discretionary fixed expenses
B)Committed fixed expenses
C)Mixed costs
D)Step-variable costs

Question

Quizplus · Accepted Answer

Discretionary fixed expenses refer to costs incurred for the acquisition of short-run activity capacity, usually as the result of yearly planning. Committed fixed expenses refer to costs that are fixed in the short run and cannot be easily adjusted. Mixed costs refer to costs that have both a fixed and variable component. Step-variable costs refer to costs that increase in steps as activity levels increase.

The Costs Incurred for the Acquisition of Short-Run Activity Capacity