A company would be reducing its discretionary costs if it
A)fired a production supervisor.
B)closed its research and development department.
C)successfully negotiated a reduction in its factory rent.
D)reduced its direct labor costs by hiring temporary workers.

Question

Quizplus · Accepted Answer

Discretionary costs are those that can be easily adjusted or eliminated without directly affecting the core operations of a business. Closing its research and development department is an example of reducing discretionary costs, as R&D is typically considered a discretionary expense that can be scaled back or expanded based on the financial situation of the company.

A Company Would Be Reducing Its Discretionary Costs If It