Respuesta :
Cost behavior is A. the way in which costs change when the activity level changes.
Such business setup will see process changes over time, and the best approach to handle any unforeseen adjustments is to be well prepared in advance for them. Cost behavior is one such component that is affected by changes.
Cost behavior serves as a predictor of how a cost will vary overall when an activity is changed. Three distinct cost behavior categories are often covered in cost accounting and managerial accounting:
Variable expenses - A variable cost's overall amount rises in direct proportion to an activity's growth. Additionally, the overall quantity of a variable cost will drop in line with a declining activity.
Fixed prices - When an activity increases or decreases, the overall amount of a fixed cost remains constant.
Semi-variable or mixed expenses - These expenses are split between fixed and variable costs.
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