Harry's Hotdogs is a small street vendor business owned by Harry Huggins.Harry is trying to get a better understanding of his costs by categorizing them as fixed or variable.Which of the following costs are most likely to be considered fixed costs

Question

Quizplus · Accepted Answer

A fixed cost is one that does not change with the level of output or sales. The cost of a vending permit is a fixed cost as it is a fixed expense that does not change irrespective of the number of hotdogs sold. The cost of mustard and hotdog buns may vary based on the number of hotdogs sold, making it a variable cost. Similarly, the cost of wages paid to workers will also vary based on the number of hotdogs sold, making it a variable cost.

Harry's Hotdogs Is a Small Street Vendor Business Owned by Harry