Alex owns a lumber yard. Sometimes they order 100 planks of oak wood, but sometimes they only orders 50. They spend $12 per plank of wood. These types of costs fluctuate depending how many planks of wood they need to order, what type of costs are these considered?Select answer from the options belowVariable costsMaterial overhead costsDirect material costsFixed costs.
Question
Alex owns a lumber yard. Sometimes they order 100 planks of oak wood, but sometimes they only orders 50. They spend $12 per plank of wood. These types of costs fluctuate depending how many planks of wood they need to order, what type of costs are these considered?Select answer from the options belowVariable costsMaterial overhead costsDirect material costsFixed costs.
Solution
These costs are considered Variable costs.
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