Use the information below to answer the following question(s).Big Island Coffee Co.produced and sold 120,000 units last year.Per unit revenue and costs were as follows:
Fixed manufacturing overhead and administrative salaries are fixed costs.The per unit amounts are based on last year's production.
-Which of the following is a fixed cost for an automobile manufacturing plant?
A)straight-line amortization on factory equipment
B)electricity used by assembly-line machines
C)sales commissions
D)windows for each car produced
E)labour cost of assembly line workers

Question

Use the information below to answer the following question(s).Big Island Coffee Co.produced and sold 120,000 units last year.Per unit revenue and costs were as follows:
  Fixed manufacturing overhead and administrative salaries are fixed costs.The per unit amounts are based on last year's production.
-Which of the following is a fixed cost for an automobile manufacturing plant?
A)straight-line amortization on factory equipment 
B)electricity used by assembly-line machines 
C)sales commissions 
D)windows for each car produced 
E)labour cost of assembly line workers

Quizplus · Accepted Answer

Fixed costs are costs that do not vary with changes in the level of production, and therefore straight-line amortization on factory equipment is a fixed cost for an automobile manufacturing plant. Electricity used by assembly-line machines, sales commissions, windows for each car produced, and labor cost of assembly line workers are variable costs because they change with production levels.

Use the Information Below to Answer the Following Question(s)