Which of the following costs could contain both variable and fixed cost elements with respect to the total output of the company?
A) Sales commissions.
B) Manufacturing overhead.
C) Direct materials.
D) Administrative salaries.

Question

Quizplus · Accepted Answer

Manufacturing overhead could contain both variable and fixed cost elements with respect to the total output of the company. Variable costs in manufacturing overhead could include items such as utilities or maintenance costs that vary based on production output, while fixed costs could include items such as rent or property taxes that do not vary based on production output. The other options listed are more likely to be either entirely variable (sales commissions and direct materials) or entirely fixed (administrative salaries).

Which of the Following Costs Could Contain Both Variable and Fixed