A retail organization's sales salaries consist of a base amount plus a commission of 5 percent on each sale. Which of the following would properly classify the cost of sales salaries?
A) Fixed and product
B) Mixed and period
C) Mixed and product
D) Variable and product

Question

Quizplus · Accepted Answer

Sales salaries are considered a mixed cost because they include a fixed base salary and a variable commission component. They are classified as a period cost because they are not directly tied to the production of goods.

A Retail Organization's Sales Salaries Consist of a Base Amount