Costs directly related to the production of goods for sale that vary directly with the production level are called

Question

Quizplus · Accepted Answer

Costs that vary directly with the production level are called variable costs, and are directly related to the cost of goods sold (COGS). Therefore, the best choice is E - Cost of goods sold. Goodwill (A) is an intangible asset and not directly related to production costs. Fixed costs (B) are costs that do not vary with production levels, and operating costs (C) include both fixed and variable costs. Tangible costs (D) is not a commonly used term.

Costs Directly Related to the Production of Goods for Sale