Question

Payment of insurance premium is an example of ___________.

• A. managed costs
• B. programmed costs
• C. committed costs
• D. discretionary costs

Answer 1

The correct option is C committed costs

Committed cost is that cost which business has already spend and can not be recovered against the obligation from which business can not get out of this.

Payment of insurance premium is once paid, can not be recovered. Hence it is an example of committed cost.