The total production costs at Kellner Machine Works are $87,000 out of which $45,000 represent fixed costs. Which of the following is representative of the variable costs incurred by the company?
A) $35,000
B) $42,000
C) $45,000
D) $87,000
E) $132,000

Question

Quizplus · Accepted Answer

Variable costs are calculated by subtracting fixed costs from total production costs. Therefore, $87,000 - $45,000 = $42,000.

The Total Production Costs at Kellner Machine Works Are $87,000