Which of the Following Would Be Considered a Fixed Cost

question 7

Multiple Choice

Which of the following would be considered a fixed cost in a manufacturing setting?

• A) Depreciation
• B) Direct labor
• C) Sales commissions
• D) Direct materials

---

Definitions:

Short-Term Debts

Liabilities due within a short period, typically one year, used to fund immediate operational needs or current liabilities.

Debt Financing

The process of raising capital through borrowing money, often via loans or bond issuance.

Accounts Receivable Turnover

A financial metric that measures how effectively a company collects debts from its customers over a period, indicating the efficiency of credit policies and collection efforts.

Net Credit Sales

The net sales of a company, calculated by subtracting returns, discounts, and allowances for damaged or missing merchandise from the total sales.