Identification of Variable and Fixed Costs
Indicate whether each of the following costs of productive output is usually (a) variable or (b) fixed:
1. Packing materials for stereo components
2. Real estate taxes
3. Gasoline for a delivery truck
4. Property insurance
5. Depreciation expense of buildings (calculated with the straight-line method)
6. Supplies
7. Indirect materials
8. Bottles used to package liquids
9. License fees for company cars
10. Wiring used in radios
11. Machine helper’s wages
12. Wood used in bookcases
13. City operating license
14. Machine depreciation based on machine hours used
15. Machine operator’s hourly wages
16. Cost of required outside inspection of each unit produced