Which of the following is an example of a discretionary fixed expense?
A)direct labour
B)depreciation on a factory building
C)insurance on a building
D)property taxes on a factory building

Question

Quizplus · Accepted Answer

Discretionary fixed expenses are those expenses that a company can control, decide on, and adjust. Insurance on a building is an example of a discretionary fixed expense because the company can choose the level of coverage and the insurance provider. Direct labour is a variable expense because it varies with production levels. Depreciation and property taxes are fixed expenses, but not discretionary because they are mandatory expenses that the company cannot control or adjust.

Which of the Following Is an Example of a Discretionary