Question

________ expenses are partly fixed and partly variable.

• A. All
• B. Variable
• C. Fixed
• D. Semi-variable

Answer 1

Answer: (D)

Semi-variable

• Fixed expenses cost the same amount each month. These bills cannot easily be changed and are usually paid on a regular basis, such as weekly, monthly, quarterly or from year to year.
• Unlike fixed costs, variable costs do increase or decrease with your business activity. Some examples are direct materials, production supplies, shipping costs, merchant fees, and billable wages.
• Semi-variable costs consist of both fixed and variable costs. Part of the cost stays consistent (often a base cost) and part fluctuates with business activity. Examples include commission payments and overage charges.