An example of a discretionary fixed cost would be:
A)taxes on the factory.
B)depreciation on manufacturing equipment.
C)insurance.
D)research and development.

Question

Quizplus · Accepted Answer

Research and development is a discretionary fixed cost because it is a planned expense that management can choose to incur or not based on the availability of funds and their priorities. In contrast, taxes on the factory, depreciation on manufacturing equipment, and insurance are all fixed costs but are not discretionary because they are typically required expenses that cannot be easily adjusted or avoided.

An Example of a Discretionary Fixed Cost Would Be