LO1 LO 1 EXERCISES: SET A Identification of Variable and Fixed Costs e whether each of the following costs of productive output is usually (a) variable or (b) fixed: 1. License fee for company car 6. Machine depreciation based on fived 2. Wiring used in radios machine hours used 3. Machine helper's wages variable 7. Machine operator's hourly wages fixed 4. Wood used in bookcases 8. Cost of required outside inspection of 5. City operating license each unit produced Variable Cost Analysis E2A. Zero Time Oil Change has been in business for six months. The company pays $0.75 per quart for the oil it uses in servicing cars. Each job requires an average of 4 quarts of oil. The company estimates that in the next three months, it will service 250, 280, and 360 cars. 1. Compute the cost of oil for each of the three months and the total cost for all three months. 2. Complete the following sentences by choosing the words that best describe the cost behavior at Zero Time: a. Cost per unit (increased, decreased, remained constant). b. Total variable cost per month (increased, decreased) as the quantity of oil used (increased, decreased)