Helena Company reports the following total costs at two levels of production.
|
10,000 Units |
20,000 Units |
|
|
Direct materials |
$20,000 |
$40,000 |
|
Maintenance |
8,000 |
10,000 |
|
Direct labor |
17,000 |
34,000 |
|
Indirect materials |
1,000 |
2,000 |
|
Depreciation |
4,000 |
4,000 |
|
Utilities |
3,000 |
5,000 |
|
Rent |
6,000 |
6,000 |
Classify each cost as variable, fixed, or mixed.
Recall that a variable cost varies in total directly and proportionately with each change in activity level.
Recall that a fixed cost remains the same in total with each change in activity level.
Recall that a mixed cost changes in total but not proportionately with each change in activity level.