Which of the following is characteristic of discretionary fixed costs?
A)They cannot be easily changed.
B)They often involve a long-term contract.
C)They can be easily changed by management.
D)They increase as output increases.

Question

Quizplus · Accepted Answer

Discretionary fixed costs are costs that can be easily changed by management based on their judgment and decision-making. Examples of such costs include advertising expenses and employee training costs. Therefore, option C is the correct choice. Option A, D are incorrect because discretionary costs are fixed in nature but can be changed easily. Option B is incorrect because a long-term contract may be a characteristic of committed fixed costs, not discretionary fixed costs.

Which of the Following Is Characteristic of Discretionary Fixed Costs