Question

which of the following is not on example of fixed cost?
(a) Rent (b) insurance premiums
(c) cost of raw materials (d) none of above​

Answer 1

Answer:

Cost of raw materials...............

Answer 2

Answer:

(c) Cost of raw materials is not an example of fixed cost.

Explanation:

• A cost that does not vary regardless of the change in the number of goods or services produced or sold is termed a fixed cost.
• They are the costs that must be paid by a business regardless of its actions.
• They are generally indirect, as they do not apply to the production of any goods or services by a company.
• Fixed and variable costs are the two categories of costs that companies typically have, and their overall costs are the sum of the two.
• Raw material costs are not considered fixed costs because they fluctuate depending on how much a company produces and sells.
• It is an example of variable costs, as they rise with increased production and fall with decreased production.