In terms of cost behavior, supervisory salaries and direct labor are classified as
A) fixed and variable, respectively.
B) both variable.
C) both fixed.
D) mixed and fixed, respectively.

Question

Quizplus · Accepted Answer

Supervisory salaries are usually considered fixed costs as they tend to remain the same regardless of changes in the level of production. On the other hand, direct labor costs tend to vary with the level of production, making them a variable cost. Therefore, supervisory salaries are fixed costs, and direct labor costs are variable costs.

In Terms of Cost Behavior, Supervisory Salaries and Direct Labor