Which of the following is a characteristic of a fixed cost?
A)The total cost remains constant, regardless of changes in the level of activity.
B)The cost per unit varies proportionately with changes in the level of activity.
C)The total cost varies when activity changes during the period.
D)The unit and total costs remain constant.

Question

Quizplus · Accepted Answer

A fixed cost is a cost that remains constant in total, regardless of changes in the level of activity. For example, rent is a fixed cost that will still need to be paid even if the business produces fewer or more units.

Which of the Following Is a Characteristic of a Fixed