Asked by Roshan Paudel on Jul 05, 2024
Verified
The fixed cost element of a mixed cost is the cost of having a service available.
Fixed Cost Element
A cost that does not vary with the level of production or sales, such as rent, salaries, and insurance expenses.
Mixed Cost
A cost that contains both fixed and variable components and changes with the level of activity, but not proportionately.
- Acquire insight into the nature of mixed, variable, and fixed costs, focusing on their classification and implementation in accounting practices.
Verified Answer
TS
Tyshawn SmithJul 12, 2024
Final Answer :
True
Explanation :
The fixed cost element of a mixed cost is the cost that remains constant regardless of the level of activity or usage. It is the cost of having a service or product available, such as rent, salaries of permanent employees, etc.
Learning Objectives
- Acquire insight into the nature of mixed, variable, and fixed costs, focusing on their classification and implementation in accounting practices.