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15 December, 15:53

The activity base selected determines whether a cost behaves as a variable cost or fixed cost.

A. True

B. False

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  1. 15 December, 16:06
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    The activity base selected determines whether a cost behaves as a variable cost or fixed cost. This statement is true.

    The correct answer is A.

    Explanation:

    Variable cost is a cost that fluctuates with respect to activity level while fixed cost is a cost that remains unchanged irrespective of activity level.

    Thus, the activity base selected determines whether whether a cost is fixed or variable.
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