Identify each cost below as variable (V), fixed (F), or mixed (M), relative to units sold. Explain your reason. (Select the corresponding number of the correct reason in the table.)

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Units Sold

25

50

75

100

V, F, or M

Reason

a.

Total phone cost

$150

$200

$250

$300

M

b.

Materials cost per unit

35

35

35

35

c.

Manager's salary

3,000

3,000

3,000

3,000

F

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1.	Does not change in total over wide ranges of volume/inversely proportional to the number of units produced while total cost remains constant.
2.	It is directly proportional to the number of units produced. The total cost changes as volume changes and in direct proportion.
3.	The total cost changes as volume changes, but not in direct proportion.

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