Asked by Zuleika Torres on Jun 28, 2024
Verified
Mark is an engineer who has designed a telecommunications device. He is convinced that there is a big potential market for the device. Accordingly, he has decided to quit his present job and start a company to manufacture and market the device.Rent on the administrative office space is:
A) a variable cost
B) an opportunity cost
C) a period cost
D) a product cost
Period Cost
Costs that are not directly tied to the production process and are expensed in the period they are incurred.
Opportunity Cost
The cost of forgoing the next best alternative when making a decision, representing the benefits one could have received by taking a different action.
Variable Cost
Costs that directly correspond with the degree of production or output levels.
- Identify and separate various cost types, including sunk costs, period costs, product costs, and opportunity costs.
Verified Answer
Learning Objectives
- Identify and separate various cost types, including sunk costs, period costs, product costs, and opportunity costs.
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