South Coast Appliance Store is a small company that has hired you to perform some management advisory services.The following information pertains to 2017 operations.

What were the total fixed costs for 2017?
A)$1,531,320
B)$366,520
C)$335,000
D)$1,164,800

Question

South Coast Appliance Store is a small company that has hired you to perform some management advisory services.The following information pertains to 2017 operations.

What were the total fixed costs for 2017?
A)$1,531,320 
B)$366,520 
C)$335,000 
D)$1,164,800

Quizplus · Accepted Answer

Fixed costs remain constant regardless of the level of production, and are typically associated with expenses such as rent, salaries, and insurance. In this scenario, the total fixed costs for 2017 are calculated by taking the total expenses and subtracting the total variable expenses. Using the information provided, the calculation is as follows: 
Total Expenses - Total Variable Expenses = Total Fixed Costs
$3,045,320 - $2,678,800 = $366,520
Therefore, the correct answer is B, $366,520.

South Coast Appliance Store Is a Small Company That Has