Reference no: EM132714064

Problem 1: The term discretionary costs refers to those

a. costs which are likely to respond to the amount of attention devoted to them by a specified manager

b. costs which are governed mainly by past decisions that established the present levels of operating and organizational capacity and which only change slowly in response to small changes in capacity.

c. amortization of costs which were capitalized in previous periods.

d. costs which management decides to incur in the current period to enable the company to achieve objective other than the filing of orders placed by customers

Problem 2: the term fixed costs refers to

a. costs which are likely to respond to the amount of attention devoted to them by a specified manager

b. costs which fluctuate in total in response to small changes in the rate of utilization capacity

c. all costs which do not change in total for a given period of time and relevant range but become progressively smaller on a per unit basis as volume increases.

d. all costs which are associated with marketing, shipping, warehousing, and billing activities.