An equipment lease that specifies a payment of $8,000 per month plus $7 per machine hour used is an example of a
A)fixed cost.
B)variable cost.
C)step cost.
D)mixed cost.

Question

Quizplus · Accepted Answer

The lease payment includes a fixed fee of $8,000 per month regardless of machine usage, but also a variable fee of $7 per hour of machine usage. This combination of fixed and variable costs makes it a mixed cost.

An Equipment Lease That Specifies a Payment of $8,000 Per