What is a variable cost in a factory?
A)factory supervisor's salary
B)lubricant for machinery
C)factory building rent
D)product advertising costs

Question

Quizplus · Accepted Answer

Variable costs are expenses that increase or decrease depending on the level of production or sales. Lubricants for machinery are directly related to the production level and are therefore a variable cost. Factory supervisor's salary and factory building rent are fixed costs, while product advertising costs can be either a fixed or variable cost depending on the type of advertising (e.g. a fixed cost for a billboard advertisement, but a variable cost for pay-per-click online ads).

What Is a Variable Cost in a Factory