Which of the following would be considered a variable cost in a manufacturing setting?
A) rent
B) administrative salaries
C) insurance
D) direct labor

Question

Quizplus · Accepted Answer

Direct labor is a variable cost as it varies with the level of production. The more products being manufactured, the more direct labor required to produce them. Rent, administrative salaries, and insurance are considered fixed costs as they do not vary with the level of production.

Which of the Following Would Be Considered a Variable Cost