Which of the following is most likely to be a variable cost?
A)the purchase price of machinery
B)interest on bonds
C)rental payments on a business's leased photocopying equipment
D)real estate taxes
E)fuel and power payments

Question

Quizplus · Accepted Answer

Fuel and power payments are most likely to vary with the level of production or sales, making them a variable cost. The other options are more likely to be fixed costs, such as the purchase price of machinery, interest on bonds, rental payments, and real estate taxes, which do not directly vary with the level of production or sales.

Which of the Following Is Most Likely to Be a Variable