Question
CCH Gold operates a gold mine in Western Australia. The manager of the company would like to better understand the cost structure of his business.
CCH Gold operates a gold mine in Western Australia. The manager of the company would like to better understand the cost structure of his business. Below is the information for the past three years of operations.
2016 | 2017 | 2018 | |
Production (tonnes of gold) | 1,400 | 2,300 | 2,100 |
Straight-line depreciation | $400,000 | $400,000 | $400,000 |
Mining labour | $364,000 | $598,000 | $546,000 |
Royalties | $185,000 | $207,500 | $202,500 |
Trucking and hauling | $220,000 | $310,000 | $310,000 |
Charitable donations* | $35,000 | $30,000 | $40,000 |
(Note: Charity donations is a managerial decision that is unlikely to be related to changes in production.)
The Mining labour cost is:
Group of answer choices:
Committed Fixed Cost
Discretionary Fixed Cost
Variable cost
Semi-variable cost
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