Which of the following best describe the term fixed costs.
A) The percentage change in operating cash flow relative to the percentage change in quantity sold.
B) The sales level that results in a zero NPV.
C) Costs that do not change when the quantity of output changes during a particular time period.
D) The possibility that errors in projected cash flows lead to incorrect decisions.
E) Opportunities that managers can exploit if certain things happen in the future.

Question

Quizplus · Accepted Answer

Fixed costs are expenses that do not vary with the level of output or production in the short term. These costs are incurred regardless of how much or how little a company produces, making option C the correct description.

Which of the Following Best Describe the Term Fixed Costs