Which of the following costs are most likely to be classified as variable?
A) Insurance
B) Straight-line depreciation
C) Manager salaries
D) Factory rent
E) Direct materials

Question

Quizplus · Accepted Answer

Direct materials costs are most likely to be variable because they are dependent on the level of production. As production increases, more materials are needed, and as production decreases, fewer materials are needed. The other options listed are more likely to be fixed costs, meaning they do not vary with the level of production.

Which of the Following Costs Are Most Likely to Be