Which of the following costs is an example of fixed cost?
A)Hourly wages of machine operators
B)Plant manager salary
C)Direct materials
D)Direct labor

Question

Quizplus · Accepted Answer

A fixed cost is a cost that does not vary with changes in the level of production or sales. The plant manager's salary is a fixed cost because it remains the same regardless of how much the company produces or sells. Hourly wages of machine operators, direct materials, and direct labor are all examples of variable costs because they change with the level of production or sales.

Which of the Following Costs Is an Example of Fixed