Variable costs per unit remain the same when the level of activity changes within the relevant range.

Question

Quizplus · Accepted Answer

This statement accurately describes the behavior of variable costs, which are costs that vary based on the level of activity or production. Within the relevant range, which is the range of activity where the company's fixed costs and other cost behavior characteristics remain constant, variable costs will remain constant on a per-unit basis. This means that as production levels increase, the total amount of variable costs will increase in proportion to the level of activity, but the cost per unit will remain the same.

Variable Costs Per Unit Remain the Same When the Level