Table of contents

1. Introduction to Accounting1h 21m
2. Transaction Analysis1h 13m
3. Accrual Accounting Concepts2h 38m
4. Merchandising Operations2h 30m
5. Inventory1h 55m
6. Internal Controls and Reporting Cash1h 16m
7. Receivables and Investments3h 8m
8. Long Lived Assets5h 1m
9. Current Liabilities2h 19m
10. Time Value of Money1h 23m
- Time Value of Money Equations
  35m
- Using Time Value of Money Tables
  47m
11. Long Term Liabilities2h 45m
12. Stockholders' Equity2h 15m
13. Statement of Cash Flows2h 24m
14. Financial Statement Analysis5h 25m
15. GAAP vs IFRS56m

1. Introduction to Accounting

Types of Accounting

Financial Accounting

1. Introduction to Accounting

Types of Accounting

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Multiple Choice

Which of the following pairs of expenses are typically considered variable expenses in accounting?

Direct materials and sales commissions

Salaries of administrative staff and insurance

Depreciation and rent

Property taxes and interest expense

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Verified step by step guidance

Understand the concept of variable expenses: Variable expenses are costs that change in proportion to the level of activity or production. They increase or decrease depending on the volume of goods or services produced.

Analyze each pair of expenses provided in the problem: Direct materials and sales commissions, Salaries of administrative staff and insurance, Depreciation and rent, Property taxes and interest expense.

Evaluate whether each expense in the pair is variable: Direct materials are typically variable because they depend on production levels, and sales commissions are variable because they depend on sales volume. Salaries of administrative staff and insurance are generally fixed expenses as they do not fluctuate with production or sales. Depreciation and rent are fixed expenses as they remain constant regardless of activity levels. Property taxes and interest expense are also fixed expenses as they do not vary with production or sales.

Identify the pair that contains both variable expenses: Based on the evaluation, the pair 'Direct materials and sales commissions' consists of variable expenses.

Conclude that the correct answer is the pair 'Direct materials and sales commissions' because both expenses in this pair are variable and align with the definition of variable expenses in accounting.