Question

4) *Fixed overhead costs* include ________.

A) the cost of sales commissions
B) property taxes paid on plant facilities
C) energy costs
D) indirect materials

Answer 1

Fixed overhead costs include property taxes paid on plant facilities, energy costs, and indirect materials. These costs do not change regardless of the level of production.

Step-by-step explanation:

Fixed overhead costs include property taxes paid on plant facilities, energy costs, and indirect materials. These costs are considered fixed because they do not change regardless of the level of production. For example, property taxes are a fixed cost because the amount paid remains the same regardless of how much the company produces. Similarly, energy costs and indirect materials are also fixed overhead costs because their expenses do not vary based on production levels.