In the decision to drop a product line, avoidable fixed costs are classified as:
A) fixed costs that are eliminated if the product is dropped
B) fixed costs that are not eliminated if the product is dropped
C) Variable costs
D) Irrelevant

Question

Quizplus · Accepted Answer

Avoidable fixed costs are those fixed costs that can be eliminated if a product line is dropped. These costs are directly associated with the product line in question and would not be incurred if the product line were discontinued.

In the Decision to Drop a Product Line, Avoidable Fixed