An example of a fixed factory overhead cost is:
A) indirect materials.
B) council rates and taxes.
C) direct labour.
D) light and power.

Question

Quizplus · Accepted Answer

Council rates and taxes are a fixed cost as they do not vary with changes in the level of production or sales. Indirect materials (option A), direct labor (option C), and light and power (option D) are variable costs as they will change with changes in production.

An Example of a Fixed Factory Overhead Cost Is