The cost formula for monthly depreciation cost in a factory is Total cost = $10,000
This cost
A) is strictly variable.
B) is strictly fixed.
C) is a mixed cost.
D) is a step cost.

Question

Quizplus · Accepted Answer

A fixed cost is a cost that does not change with changes in the volume of goods or services produced. The monthly depreciation cost in the factory of $10,000 is a fixed cost as it does not change with changes in production levels.

The Cost Formula for Monthly Depreciation Cost in a Factory