Mailroom clerks at Speedy Mail are paid a salary of $2200 per month.All clerks are full time.A new clerk is hired whenever the volume of mail increases by 40 000 pieces since the last clerk was hired.If volume of mail is the activity base mail-handling costs are:

Question

Quizplus · Accepted Answer

The cost of hiring a new clerk is directly related to the activity of mail volume. As the volume of mail increases by a step of 40,000 pieces, the cost of hiring a new clerk also increases by a step, making it a step-variable cost. Therefore, the best choice is D.

Mailroom Clerks at Speedy Mail Are Paid a Salary of $2200