An example of a discretionary fixed cost is:
A)insurance.
B)management development programs.
C)taxes on real estate.
D)depreciation of buildings and equipment.

Question

Quizplus · Accepted Answer

Discretionary fixed costs are expenses that can be adjusted or eliminated at management's discretion. Management development programs fall under this category because they are not essential for the day-to-day operation of the business and can be cut if necessary without affecting the core operations of the company. The other options listed (insurance, taxes on real estate, and depreciation of buildings and equipment) are all fixed costs but are not discretionary because they are essential expenses required to maintain the business.

An Example of a Discretionary Fixed Cost Is