The fixed cost per unit:
A) will increase as activity increases.
B) will decrease as activity decreases.
C) will decrease as activity remains constant.
D) will remain constant.
E) will increase as activity decreases and will decrease as activity increases.

Question

Quizplus · Accepted Answer

Fixed costs per unit decrease as activity increases and increase as activity decreases because the total fixed costs are spread over more or fewer units, respectively.

The Fixed Cost Per Unit