Gordon Company sold 2,000 more units than budgeted of its only product.How will total fixed cost be affected?
A)Remain constant.
B)Decrease by same percentage as sales increase.
C)Increase by same percentage as sales increase.
D)Decrease $2,000.
E)Increase $2,000.

Question

Quizplus · Accepted Answer

Total fixed costs do not change in the short run, regardless of changes in sales volume. Therefore, the fixed costs will remain constant regardless of the fact that Gordon Company sold more units than planned.

Gordon Company Sold 2,000 More Units Than Budgeted of Its