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1. Consider the six costs that follow. 1. Advertising and promotion costs of a do-it-yourself retailer 2. Surgical supplies used in a hospital's operating room
1. Consider the six costs that follow. 1. Advertising and promotion costs of a do-it-yourself retailer 2. Surgical supplies used in a hospital's operating room 3. Aircraft depreciation charges of an airline 4. Utility charges that include a minimum-use fee, for a small business 5. Annual business licensing fee paid by a daycare center 6. Truck fuel consumed by a road construction company Required: A. Classify each of these costs as variable, committed fixed, discretionary fixed, or semivariable. B. Briefly describe the behavior of a per-unit variable cost as activity changes. C. What elements are present in a semivariable cost that cause it to behave in a semivariable manner? D. Generally speaking, does management have more flexibility when dealing with committed fixed costs or discretionary fixed costs
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