Cy recently went into the business of producing and selling cardboard boxes. For this business, which of the following is most likely to be a fixed cost?
A)fire insurance
B)labor costs
C)paper costs
D)adhesive costs
E)b, c, and d are equally likely to be fixed costs

Question

Quizplus · Accepted Answer

Fire insurance is a fixed cost because it is a regular expense that does not change with the level of production or sales, unlike labor, paper, and adhesive costs, which vary depending on the quantity of cardboard boxes produced and sold.

Cy Recently Went into the Business of Producing and Selling