Costs arising from the possession of facilities, equipment, and a basic organization are ____.
A)capacity costs
B)discretionary costs
C)committed fixed costs
D)engineered costs

Question

Quizplus · Accepted Answer

These costs are committed fixed costs because they are necessary to maintain the basic infrastructure of the organization regardless of how much or little the organization produces. Capacity costs are related to the cost of producing one additional unit, discretionary costs are optional expenses that can be adjusted, and engineered costs are costs that can be predicted with a formula or measurement.

Costs Arising from the Possession of Facilities, Equipment, and a Basic