Two costs at Bradshaw Company appear below for specific months of operation. $\begin{array}{llrl}
& \underline{\text { Month }}& \underline{\text {Amount}}& \underline{\text { Units Produced }}\
\text { Delivery costs } & \text { September } & \$ 40,000 & 40,000 \
& \text { October } & 55,000 & 60,000 \
\text { Utilities } & \text { September } & \$ 84,000 & 40,000 \
& \text { October } & 126,000 & 60,000
\end{array}$ Which type of costs are these?
A) Delivery costs and utilities are both variable.
B) Delivery costs and utilities are both mixed.
C) Utilities are mixed and delivery costs are variable.
D) Delivery costs are mixed and utilities are variable.

Question

Quizplus · Accepted Answer

The costs for Bradshaw Company are classified as mixed and variable costs. The cost of delivery is mixed because it has both fixed and variable components, while the cost of utilities is variable because it varies with the level of production. Therefore, the best choice is D, Delivery costs are mixed and utilities are variable.

Two Costs at Bradshaw Company Appear Below for Specific Months