When preparing a flexible budget for factory overhead costs,what will occur to fixed costs (on a per-unit basis)as production increases?
A)Fixed costs per unit will increase.
B)Fixed costs are not considered in flexible budgeting.
C)Fixed costs per unit will decrease.
D)Fixed costs per unit will remain unchanged.

Question

Quizplus · Accepted Answer

Fixed costs per unit decrease as production increases because the total fixed costs are spread over more units, reducing the cost allocated to each unit.

When Preparing a Flexible Budget for Factory Overhead Costs,what Will