Question
Rochester Motor Company manufactures and sells a single product.The following information pertains to the company's projected operating costs for the months of June and July:
Rochester Motor Company manufactures and sells a single product.The following information pertains to the company's projected operating costs for the months of June and July:
JuneJuly
Production Volume30003600
Direct Materials$45,000 $54,000
Direct Labor36,00043,200
Machine maintenance 5,0005,500
Factory insurance 2,0002,000
Depreciation on machinery3,5003,500
Electricity used in factory1,5002,000
Based on this evidence, which of the following is fixed cost?
A. Direct material
B. Direct labor
C. Electricity used in factory
D. Factory Insurance
E. Machine maintenance
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