Which one of these is both a product cost and a fixed cost in the short run?
A)Monthly electric bill for manufacturing facility
B)Salary for company CEO
C)Overtime pay for production employees
D)Sales commission paid based on monthly sales
E)Monthly lease payment for production equipment

Question

Quizplus · Accepted Answer

The monthly lease payment for production equipment is a product cost because it is directly related to the production process. It is also a fixed cost in the short run because it will remain constant regardless of the level of production, at least until the lease agreement expires.

Which One of These Is Both a Product Cost and a Fixed