Figure 3-6.

Taran Company incurred the following costs for the months of January and February.

Type of CostJanuary

February

Insurance$ 5,000

$ 5,000

Utilities4,000

5,000

Depreciation3,500

3,500

Materials10,000

20,000

Refer to Figure 3-6. If output was 5,000 units in January and 10,000 units in February we can assume that

a.utilities, insurance, and depreciation are fixed costs.

b.utilities and materials are variable costs.

c.materials are the only variable cost.

d.insurance and depreciation are mixed costs.