Fixed costs:
A) are a constant percentage of sales revenues.
B) vary with the level of depreciation expense.
C) are constant over a given range of output.
D)are inversely related to the level of output.

Question

Quizplus · Accepted Answer

Fixed costs are costs that do not vary with changes in the level of output or sales revenues. They are constant over a given range of output. Option A is incorrect because fixed costs are not a percentage of sales revenues. Option B is incorrect because fixed costs do not vary with depreciation expense. Option D is incorrect because fixed costs are not inversely related to the level of output.

Fixed Costs