Asked by Samantha Ortiz on May 25, 2024
Verified
A step-wise variable cost can be separated into a fixed component and a variable component.
Step-Wise Variable Cost
A cost that remains fixed within a certain level of activity but will jump to a higher amount at a certain point due to increased activity.
- Identify the differences between fixed, variable, and mixed costs in context to their correlation with production quantities.
Verified Answer
KJ
Kevin JoudiMay 25, 2024
Final Answer :
False
Explanation :
A step-wise variable cost remains constant over a range of activity but jumps to a different amount for levels of activity outside that range, making it distinct from costs that have clear fixed and variable components.
Learning Objectives
- Identify the differences between fixed, variable, and mixed costs in context to their correlation with production quantities.
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