A variable costing income statement is one in which all variable expenses are deducted from revenue to arrive at a separately-stated contribution margin, from which all fixed expenses are then subtracted to arrive at the net profit or loss for the period.. I need to know which of the following expenses are fixed and variable: Indirect materials 2,000 Administrative salaries 35,000 Utilities 21,000 Rent 16,000 Miscellaneous costs 3,000 Insurance 7,000 Advertising expense 120,000 Amortization 2,400 Shipping expense 10,000 Marketing report 2,000 According to me the fixed expenses can be classfied into Manufacturing O.H, Admn expenses, … Variable expenses are defined as such because the amount you spend may vary each month. Saving for retirement, emergencies, and other financial goals could be considered a fixed expense to ensure you're working towards building wealth and preparing for the future. A. A cost to a person or business that varies over time according to a number of factors. a. sales commission b. hourly wages c. rent d. materials 2 See answers thegreatandpowe thegreatandpowe The answer is c. Rent abreen609 abreen609 The correct answer is rent. Answer to Which of the following would be considered a variable expense ? As sales go down, variable costs go down. Thus, the materials used as the components in a product are considered variable costs, because they vary directly with the number of units of product manufactured. A. A typical household has normal monthly expenses like water, electricity, mortgage, credit card, or other items. For example, a dental office must buy dental supplies, which usually cost about the same. a. insurance for employee automobiles Incorrect b. feed for cattle at a feed lot The definition of a variable cost is a cost that changes with changes in volume or activity. Which of the following costs would be considered variable? Although variable costs are quite often discretionary expenses, some may be necessities. The cost of property & casualty insurance. excessive and to be avoided if at all possible. Which of the following is a variable cost in an insurance company? Question: Which Of The Following Would Be Considered A Variable Expense? Fixed costs include rent, utilities, payments on loans, depreciation and advertising. Have you ever considered the difference between fixed and variable expenses? A. rent B. interest payment on a loan C. cost of raw materials D. salary of a permanent, full-time worker Weegy: An example of a variable cost is cost of raw materials. The logic behind this expensing of fixed manufacturing costs is that the company would incur such costs whether a plant was in production or idle. A decrease in net worth would be the result of A) income greater than expenses for a month. B. Knowing fixed and variable expenses in your budget is important. What are Variable Costs? What Is a Variable Cost? When classified according to traceability to cost objective, the cost of raw materials is considered a: COST CONCEPTS AND CLASSIFICATIONS 1 DRAFT. University. usually greater than the cost of commercial bank credit. However, if your business includes manufacturing, the electricity can be considered a variable cost, as it will likely fluctuate with production. Variable overhead is the cost of operating a business, which fluctuates with manufacturing activity. Variable costing (also known as direct costing) treats all fixed manufacturing costs as period costs to be charged to expense in the period received.Under variable costing, companies treat only variable manufacturing costs as product costs. New questions in Mathematics. 35 times. Variable expenses, such as utility bills, may make it difficult to accurately budget. For example, shipping costs, costs for raw materials, or for employees who are making and shipping products or providing services are usually variable. In other words, with either a high or a low patient census, expenses related to rent, utilities, loan payments, administrative salaries, and salaries of the minimum number of staff to keep a unit open must be paid. usually greater than the cost of factoring receivables. As production output increases or decreases, variable overhead moves in tandem. Grocery shopping is also a variable expense. Variable Cost: A variable cost is a cost that varies depending on the level of output. Raw Materials C. Interest D. Insurance This problem has been solved! This is a variable cost. Variable Overheads; Such Overhead expenses are the ones that vary in direct proportion to the volume of output. A. Salary paid to the chief financial officer. Variable costs (aka variable expenses) Falling under the category of cost of goods sold (COGS), your total variable cost is the amount of money you spend to produce and sell your products or services. B. If Pierre’s recipe makes 6 dozen cakes (72 cakes), the variable cost per unit would be $1. C. Rent on the production and office facilities. When the sales are $30,000 the cost of goods sold will be $18,000. The variable cost to make all of the cakes is $72. That includes labor costs (direct labor) and raw materials (direct materials). C) the effect of the order on regular sales. For instance, if a company purchases a product for $30 and then sells it for $50, its cost of goods sold will be a constant rate of 60%. Maintenance ...This is definitely a variable operating expense. Variable costs such as commissions, bonuses and utility bills vary based on product production and sales for the period, whereas fixed costs do not tend to fluctuate. Better money management helps create the financial peace we all desire. B) the variable costs associated with the special order. This is a fixed cost. Variable costs are the costs of labor or raw materials because these items change with sales. Answer and Explanation: Variable expenses are those that can change based on things like weather, cost, demand, or many other variables. Rent B. D) fixed costs that will not be affected by the order. A) Rent B) An installment loan payment C) A mortgage payment D) A monthly parking fee E) A telephone bill Answer: E Difficulty: Med LO: 3 Page: 79 52. _____ is considered a variable operating expense of an automobile. It can help you create a budget that reduces your stress level. Variable selling and administrative costs also must be distinguished from variable manufacturing costs, which often have similar account names. Clara’s Costumes is a retailer of costumes, primarily purchased for Halloween. Variable Overhead Examples include Shipping expenses, Advertising Costs, etc. a ) Rent b ) Raw materials c ) interest d ) Insurance Hence when its sales are $10,000 the cost of goods will be $6,000. Variable Expenses Variable expenses are still necessary costs, but the amount changes every month, often in concert with your usage or choices. And it can increase your financial stability at the same time. 1  Variable costs are directly related to sales volume. The second kind of costs to consider are your variable expenses. D. A manager should always reject a special order if A) the special order price is less than the variable costs of the order. Buying gas for your car each month is a variable expense, as are car repairs and maintenance. Which of the following is considered a variable cost? Variable costs are unfixed, discretionary costs that include gas, clothing, entertainment, pet supplies and dining out at restaurants. The definition of variable costs can differ, but we like to define them as anything you can buy in a store (for example groceries, gas, or coffee) or expenses that are within your control. On the other hand, the dental office must also pay the electric and gas and water bills, which may fluctuate considerably. 12. the lowest of any form of short-term financing. One way for a company to save money is … B) there is available excess capacity. Variable cost/total quantity of output = x variable cost per unit of output Variable cost per unit = = $72/72 = $1. Another example of a variable expense is a retailer's cost of goods sold. Variable expenses are tied in to your business's productivity. User: Which of the following would be considered an example of a variable cost? This expense is directly related to sales. Select One: A. The cost of trade credit involving cash discounts as a form of short-term financing is: Answer. darkbakshi|Points 706| User: Which of the following business practices, which forced competitors to shut down, was Standard Oil accused of … The more a car is driven, the more often the oil-and-lube must be executed, as well as purchase of new tires, as well as the 30,000 mile servicing, etc. You can decide how much and if you will spend on these items. Which of the following would be considered a variable cost? What is a variable expense? Question 15 These overhead expenses are directly affected by business activity. The key is that it must change as volume changes. Variable costs are costs that change regularly while fixed costs remain the same all the time. D. Wages paid to customer service representatives. You can define variable expenses as the costs that change month to month, depending on quantity or usage. 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