Which of the following would be considered a committed fixed cost?
A) Research and Development
B) Depreciation
C) Office holiday party
D) Advertising

Question

Quizplus · Accepted Answer

Committed fixed costs are expenses that cannot be easily adjusted or reduced, such as long-term leases, salaries of key employees, and depreciation of assets. Depreciation is a committed fixed cost because it represents the gradual loss of value of a company's capital assets, and cannot be changed in the short term. A, C, and D are not committed fixed costs, as they can be adjusted or eliminated depending on the company's needs and priorities.

Which of the Following Would Be Considered a Committed Fixed