Question

What is a variable expense?

Group of answer choices

An expense that is different from month to month.

An expense that is the same from month to month.

An expense that is the same during some months, and different during other months

Answer 1

A variable expense is an expense that changes with the level of production or activity, such as raw materials or labor costs.

Step-by-step explanation:

A variable expense is an expense that varies with changes in the level of output or other activities. Unlike fixed expenses, which remain constant regardless of how much is produced, variable expenses change based on production volume. Examples of variable costs include the cost of raw materials and the labor costs associated with extra workers or work hours needed to meet the production demand. As production increases, so do the variable costs; similarly, if production decreases, the variable costs will typically reduce as well.