Question

Pete owns a shoe-shine business. His accountant most likely includes which of the following costs on his financial statements?

1) Fixed costs
2) Variable costs
3) Operating costs
4) Capital costs

Answer 1

The accountant for Pete's shoe-shine business most likely includes operating costs on his financial statements.

Step-by-step explanation:

The accountant for Pete's shoe-shine business most likely includes operating costs on his financial statements.

Operating costs are the ongoing expenses that a business incurs during its normal course of operations. These costs include items such as employee wages, utility bills, supplies, and maintenance expenses.

In Pete's shoe-shine business, the accountant would include operating costs like wages paid to employees, cost of cleaning and maintaining the equipment, and supplies used in the shoe-shining process.